tag:blogger.com,1999:blog-58963199203827215412017-12-10T19:17:06.156-08:00The Worden Report - Business & SocietyDr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comBlogger67125tag:blogger.com,1999:blog-5896319920382721541.post-84851113491431039042017-12-04T17:20:00.000-08:002017-12-04T17:32:49.186-08:00Advertisers Remove Ads on YouTube: Fair to YouTube and Video-Producers?<div class="MsoNormal"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">One day after Thanksgiving in 2017, “a fresh wave of advertisers suspended commercials on Youtube after their ads showed up next to videos that appeared to attract pedophile viewers.”<a href="file:///C:/Users/Nietzsche/Desktop/Advertisers%20resist%20ads%20on%20youtube.docx#_edn1" name="_ednref1" title=""><span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="line-height: 115%;">[1]</span></span><!--[endif]--></span></a>Youtube had removed ads from roughly 3 million videos, but the company’s use of human and AI checkers simply could not keep pace with the number of uploaded videos. Even so, Diageo, maker of Smirnoff and Johnnie Walker (alcohol drinks), announced it would hold off its ads until “appropriate safeguards are in place.”<a href="file:///C:/Users/Nietzsche/Desktop/Advertisers%20resist%20ads%20on%20youtube.docx#_edn2" name="_ednref2" title=""><span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="line-height: 115%;">[2]</span></span><!--[endif]--></span></a>Mars and Adidas took a similar line. The question is whether those advertisers were being fair to Youtube and even the producers of the videos. <o:p></o:p></span><br /><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div></div><div class="MsoNormal"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">After a similar revolt the previous March, YouTube and hired more human reviewers and furnished advertisers with new tools to control where their ads would appear. Did not those companies have some responsibility to keep tabs on their ads, especially given the incentive to do so.&nbsp; “Advertisers don’t want their brands associated with objectionable content and as well can face criticism if their advertising money goes to support the videos’ creators.”<a href="file:///C:/Users/Nietzsche/Desktop/Advertisers%20resist%20ads%20on%20youtube.docx#_edn3" name="_ednref3" title=""><span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="line-height: 115%;">[3]</span></span><!--[endif]--></span></a>It would not have been prudent to leave it to YouTube to review the ads, especially if the advertisers knew that YouTube was short-staffed. Unlike the advertisers, YouTube’s management had little incentive; the pull-out of certain advertisers in March, 2017 had “little impact” on Alphabet’s (Google’s) overall business. In fact record profits were posted. <o:p></o:p></span><br /><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div></div><div class="MsoNormal"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Of course, the ability and will to review ads, whether by the advertisers or YouTube, would not in itself have caught the cases in which the videos themselves were salubrious and yet received unsavory comments from viewers. An advertiser could hardly be blamed for placing an ad in such a video; neither would YouTube be culpable in having permitted the video in the first place. So even if sordid comments could be readily removed, the incentives would be lacking. To be sure, YouTube is responsible for removing such comments, and just because blame would not be justified concerning innocent videos does not necessarily mean that such blame would not be exacted anyway. <o:p></o:p></span><br /><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div></div><div class="MsoNormal"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">The nuances of responsibility suggest that the reaction of the advertisers was rather blunt and even impulsive, and not entirely fair to YouTube and the video-producers. Distinguishing between objectionable and proper videos, and then between the latter and disgusting comments would be part of a smarter, more refined approach.<o:p></o:p></span></div></div><div style="text-align: justify;"><br /></div><div><!--[if !supportEndnotes]--><br clear="all" /><hr align="left" size="1" width="33%" /><!--[endif]--> <br /><div id="edn1"><div class="MsoEndnoteText"><a href="file:///C:/Users/Nietzsche/Desktop/Advertisers%20resist%20ads%20on%20youtube.docx#_ednref1" name="_edn1" title=""><span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="font-family: &quot;calibri&quot; , &quot;sans-serif&quot;; font-size: 10.0pt; line-height: 115%;">[1]</span></span><!--[endif]--></span></a> Stu Woo and Sam Schehner, “YouTube Deals With Another Advertiser Backlash,” <i>The Wall Street Journal</i>, November 25-26, 2017.<o:p></o:p></div></div><div id="edn2"><div class="MsoEndnoteText"><a href="file:///C:/Users/Nietzsche/Desktop/Advertisers%20resist%20ads%20on%20youtube.docx#_ednref2" name="_edn2" title=""><span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="font-family: &quot;calibri&quot; , &quot;sans-serif&quot;; font-size: 10.0pt; line-height: 115%;">[2]</span></span><!--[endif]--></span></a> Ibid.<o:p></o:p></div></div><div id="edn3"><div class="MsoEndnoteText"><a href="file:///C:/Users/Nietzsche/Desktop/Advertisers%20resist%20ads%20on%20youtube.docx#_ednref3" name="_edn3" title=""><span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="font-family: &quot;calibri&quot; , &quot;sans-serif&quot;; font-size: 10.0pt; line-height: 115%;">[3]</span></span><!--[endif]--></span></a> Ibid.<o:p></o:p></div></div></div>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comtag:blogger.com,1999:blog-5896319920382721541.post-59299224637863693652017-11-29T14:24:00.000-08:002017-11-29T14:26:01.375-08:00Customers Give Uber a Pass: A Lapsed Enforcement of Business Ethics<div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">A letter from a former security employee at Uber claims that the company’s Marketplace Analytics department “exists expressly for the purpose of acquiring trade secrets, codebase and competitive intelligence.”<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="line-height: 115%;">[1]</span></span><!--[endif]--></span>The letter caused the judge to delay the trial in which Uber stood accused of stealing trade secrets involving self-driving cars from Waymo. “I can no longer trust the words of the lawyers for Uber in this case,” Judge Alsup said.<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="line-height: 115%;">[2]</span></span><!--[endif]--></span>Ouch! The question remained whether Uber customers would punish the company by turning to Lyft instead. Unfortunately, the typical customer may overlook unethical practices at a company if a good deal is to be had. Economizing monetarily serves self-interest, whereas “walking with your wallet” oftentimes does not. Standing on principle may simply not register when people have their consumer hats on. <o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">After its systemic customer-fraud was exposed, Wells Fargo’s management simply offered sweeter terms to entice existing customers to stay put and even to attract new ones. Although the bank had to pay in the form of offering better rates, society at large may have expected more in the form of an exodus of customers from the sordid bank for such institutions in which fraud is so systemic should arguably not continue to exist. <o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Even before the revealing letter was read to Uber’s judge, the company had gotten the attention of its customers by “grabbing headlines for ignoring complaints about sexual harassment at its headquarters as well for a variety of corporate practices” that had piqued the interest of regulators.<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="line-height: 115%;">[3]</span></span><!--[endif]--></span>&nbsp; Even so, Uber had reported a 10% increase in second-quarter (2017) bookings over the first quarter, according to Bloomberg.<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="line-height: 115%;">[4]</span></span><!--[endif]--></span>Uber hit 5 billion rides in more than 70 countries during the summer of 2017. This suggests that “for a majority of consumers, disgust over corporate misconduct doesn’t always translate to ditching a reliable service.”<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="line-height: 115%;">[5]</span></span><!--[endif]--></span>&nbsp; Managements can thus buy themselves out of trouble by retaining the vast majority of customers by offering better terms. <o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Lest it be decried that such self-rescues should not be allowed, we have only to look at the customers who look the other way as they single-mindedly pursue their self-interest. Admittedly, they could point to government regulators as being the proper instruments for holding wayward managements accountable. Unethical conduct is not always illegal, however, and where such conduct is widespread and ingrained in a company, nothing short of bankruptcy may be just. Of the latter point, justice at the hands of a court of justice or a regulatory agency may not go far enough to exact what is just <i>ethically</i>. <o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif;"><span style="font-size: large;">&nbsp;To be sure, Lyft was making inroads on Uber’s turf. TXN Solutions reported in 2017 that Uber’s market share had slipped to 75% from 90% in 2015.<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="line-height: 115%;">[6]</span></span><!--[endif]--></span>Uber’s valuation may have fallen from a high of nearly $70 billion to close to $50 billion.<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="line-height: 115%;">[7]</span></span><!--[endif]--></span> Of course, these trends could be from improvements at Lyft rather than any ethical fallout at Uber. Put another way, Lyft should arguably have been able to make more of a dent, given the sordid culture and practices at Uber’s headquarters. The sad truth may be that consumers don’t really care if a company’s management is ethical unless the consumers themselves are gouged; everyone is out for oneself without concern for principle. I submit that such a mentality—such a culture—is not in a society’s interest; the good of the whole is not merely the aggregate of individual, self-seeking choices. Even Adam Smith saw a need for government, and, moreover, of moral sentiments as enveloping a free market. Hence his text, <i>A Theory of Moral Sentiments</i>, should be read along with <i>The Wealth of Nations </i>to give the economist’s <i>full </i>theory. </span><i>&nbsp;</i></span>&nbsp;<o:p></o:p></div><br /><div><div style="text-align: justify;"><br /></div><!--[if !supportEndnotes]--> <br /><hr align="left" size="1" width="33%" /><!--[endif]--> <br /><div id="edn1"><div class="MsoEndnoteText"><a href="file:///C:/Users/Nietzsche/Desktop/Unethical%20Uber%20holds%20most%20customers.docx#_ednref1" name="_edn1" title=""><span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="font-family: &quot;calibri&quot; , &quot;sans-serif&quot;; font-size: 10.0pt; line-height: 115%;">[1]</span></span><!--[endif]--></span></a> Becky Peterson, “<a href="http://www.businessinsider.com/uber-waymo-trial-delayed-2017-11">Ex-Uber Staffer Says in Bombshell Letter that the Company Had a Unit Dedicated to Stealing Trade Secrets</a>,” <i>Business Insider</i>, November 28, 2017.<o:p></o:p></div></div><div id="edn2"><div class="MsoEndnoteText"><a href="file:///C:/Users/Nietzsche/Desktop/Unethical%20Uber%20holds%20most%20customers.docx#_ednref2" name="_edn2" title=""><span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="font-family: &quot;calibri&quot; , &quot;sans-serif&quot;; font-size: 10.0pt; line-height: 115%;">[2]</span></span><!--[endif]--></span></a>Ibid.<o:p></o:p></div></div><div id="edn3"><div class="MsoEndnoteText"><a href="file:///C:/Users/Nietzsche/Desktop/Unethical%20Uber%20holds%20most%20customers.docx#_ednref3" name="_edn3" title=""><span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="font-family: &quot;calibri&quot; , &quot;sans-serif&quot;; font-size: 10.0pt; line-height: 115%;">[3]</span></span><!--[endif]--></span></a> Marco della Cava, “Underterred by Uber, Lyft Says It’s Destined to Be No. 1,” <i>USA Today</i>, November 29, 2019.<o:p></o:p></div></div><div id="edn4"><div class="MsoEndnoteText"><a href="file:///C:/Users/Nietzsche/Desktop/Unethical%20Uber%20holds%20most%20customers.docx#_ednref4" name="_edn4" title=""><span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="font-family: &quot;calibri&quot; , &quot;sans-serif&quot;; font-size: 10.0pt; line-height: 115%;">[4]</span></span><!--[endif]--></span></a><span class="MsoEndnoteReference"> </span>Ibid.<o:p></o:p></div></div><div id="edn5"><div class="MsoEndnoteText"><a href="file:///C:/Users/Nietzsche/Desktop/Unethical%20Uber%20holds%20most%20customers.docx#_ednref5" name="_edn5" title=""><span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="font-family: &quot;calibri&quot; , &quot;sans-serif&quot;; font-size: 10.0pt; line-height: 115%;">[5]</span></span><!--[endif]--></span></a> Ibid.<o:p></o:p></div></div><div id="edn6"><div class="MsoEndnoteText"><a href="file:///C:/Users/Nietzsche/Desktop/Unethical%20Uber%20holds%20most%20customers.docx#_ednref6" name="_edn6" title=""><span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="font-family: &quot;calibri&quot; , &quot;sans-serif&quot;; font-size: 10.0pt; line-height: 115%;">[6]</span></span><!--[endif]--></span></a>Ibid.<o:p></o:p></div></div><div id="edn7"><div class="MsoEndnoteText"><a href="file:///C:/Users/Nietzsche/Desktop/Unethical%20Uber%20holds%20most%20customers.docx#_ednref7" name="_edn7" title=""><span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="font-family: &quot;calibri&quot; , &quot;sans-serif&quot;; font-size: 10.0pt; line-height: 115%;">[7]</span></span><!--[endif]--></span></a>Ibid.<o:p></o:p></div></div></div>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.com677 Prairie Dog Ln, Big Sandy, MT 59520, USA48.166085419012525 -110.2148437545.521748419012525 -115.37841775 50.810422419012525 -105.05126975tag:blogger.com,1999:blog-5896319920382721541.post-49005274834268959732017-11-25T16:51:00.000-08:002017-12-06T19:24:16.950-08:00Uncovering the Root of Poverty: An Addictive Habit<div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Addictive pain-killers killed 64,000 residents in the U.S. in 2016, in part because physicians tended to rely on patients’ self-determined ratings of pain on a scale of 1 to 10.<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="line-height: 115%;">[1]</span></span><!--[endif]--></span>Such subjective ratings were of course vulnerable to self-seeking motives willfully negligent or even reckless in terms of health. A habit or marked tendency in favor of choices at the expense of a person’s own <i>long-term </i>well-being stems, I submit, from weak impulse-control. This factor can explain a lot about why poverty exists and goes on.&nbsp;<o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Poverty, it has been said, is the cruelest form of war, for such war can go on and on and wreck subtle though tremendous damage on the afflicted. Yet the mentality that can get a person into such a war and associated bad choices can be easily overlooked by elites that deign to study the problem of poverty. <o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Attempting to explain escalating rates of suicide, overdoses, and alcoholism among uneducated Americans, Angus Deaton and Anne Case, who spoke at the CEO Council sponsored by <i>The Wall Street Journal </i>in November, 2017,&nbsp;pointed to the diminishing number of jobs “with a ladder up, with on-the-job training, with benefits.”<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="line-height: 115%;">[2]</span></span><!--[endif]--></span>With less incentive to focus on doing well at work and less opportunity to get involved in a union, a person can easily feel despondent, especially given the breakdown of the nuclear and extended family and the decline of mainline Christianity. Drugs, including nicotine and alcohol, and ultimately even suicide, can remove the resulting sense of nihilism. <o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">The job/family/religion explanation strikes me as overly formalistic, even external, however. For example, the rise of individualistic evangelical Christianity, which Deaton and Case claimed does not allow for a sense of community because of the <i>theological </i>emphasis on an individual's relationship with Jesus, can nonetheless provide social opportunities for people. A visit to any megachurch can demonstrate that “extra-curricular activities” go on in spite of the individualistic theological bent. Megachurches typically have coffee shops and fitness rooms, and even put on plays (e.g., at Easter).&nbsp;</span><br /><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Similarly, not being able to get involved in a union does not exhaust the things a person can do with others in a group; political activism, for example, is open to workers outside of the work context (e.g., working on a political campaign).</span><br /><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">I also take issue with the claim that uneducated workers do drugs because a promotion into management is no longer as easy as it may have been in the past. The work ethic is not predicated on advancement; rather, hard work itself is valued as a virtue. To be sure, the technologically and off-shore based relative loss of manufacturing jobs and the lack of satisfaction from working in a fast-food restaurant, for instance, have made it more difficult for uneducated people to find fulfilling jobs or jobs at all. Faced with loads of empty time--rather than trying to start an enterprise (e.g., a site online) or volunteer--drugs and alcohol are easy apparent fixes, or fillers. Yet the <i>decision </i>to have empty time is a course of least resistance rather than a <i>fait accompli</i>. The willingness to be lazy is itself significant, for it gets us closer to the underlying problem, which is <i>internal</i>.&nbsp;</span><br /><span style="font-family: times, times new roman, serif; font-size: large;">I submit that drug use, including alcohol and nicotine, does not stem from having lots of time from being unemployed. Rather, people who succumb to drug addition can be said to have weak impulse control; they do not have or use the strength of will to resist the urge to take another hit, or to try some drug in the first place. I've never tried heroine or cocaine even just to see what they are like because I know they are highly addictive so I have resisted offers to try them. So I'm surprised when I hear people who use those drugs treat them so casually, so conveniently, without any hint of impulse control.&nbsp;</span><br /><span style="font-family: times, times new roman, serif; font-size: large;">The lack of a college education is a contributing factor, for a surprising phenomenon of ignorance is its presumption to not being able to be wrong with respect to itself. So presuming to know all about heroine or cocaine and being able to manage them as if a physician fits with being uneducated. In college, students think through critiques of theories rather than taking them at face value; the professors model this. Being accustomed to critiquing other people's theories can get a person in the thought-habit of critiquing even one's own, even implicit, theories. In contrast, the assumption of ignorance that it must be right goes unchallenged by the uneducated. Interestingly, the difference is not just cognitive, for attitude is impacted by whether or not a person turns reason on oneself. The arrogance of ignorance contrasts with the humility that is ideally in putting one's own assumptions and beliefs about oneself and the world under the proverbial knife. Such an orientation necessitates the use of impulse-control, which in turn implies valuing it rather than conveniently assuming that it is not worthwhile.&nbsp;</span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">I submit that the “Two Americas” are separated by two trajectories of habitual thinking and values that stem from whether or not a person values and has good impulse-control. People who value such control loathe being around people who don't. Put another way, e</span><span style="font-family: times, &quot;times new roman&quot;, serif; font-size: large;">vading impulse-control is acceptable in some quarters while looked down on in others. The two respective cultures are each self-reinforcing, and social distance between those cultures naturally widens and is not just a matter of being educated or not. Unfortunately, I have been exposed to three "ghetto" apartment complexes, complete with "ghetto property-managements" whose mentality goes beyond garden-variety incompetence to reflect the lack of impulse-control evinced by many of the residents with respect to each other (e.g., being inconsiderate with noise late at night, and having a tendency to lie--failing to resist to impulse to take the easy out).&nbsp;&nbsp;</span><br /><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Speaking once with a security guard whose company covered one such “ghetto complex” in addition to other, “non-ghetto” complexes, I was struck by how he distinguished the “ghetto” residents. “They think they live in houses, playing their music as if people are not on the other side of the wall. We don't have this problem at the other complexes we handle. The people in that area of town are not so inconsiderate.” I could see why uneducated poor people live together and other people avoid them; the difference is not merely monetary. People who resist the urge to play music or movies loud at night so not to disturb neighbors also resist the urge to lie when doing so would get them off the hook. In apartment complexes populated by poor, uneducated people, the mentality is exactly the opposite, and such a sordid mentality based in a convenient refusal to engage in impulse-control (for selfish reasons) is anathema to other people, who thus keep their distance and even perhaps urge public policy that hurts the poor. Regardless of how sordid the attitude is, I contend that poor people's human rights to sustenance should be respected and protected. This is particularly so because of how intractable the attitude truly is. A person who is used to dismissing impulse-control (i.e., not valuing it) is not likely to go down the other track, unless the motive comes from sustained suffering.&nbsp;</span><br /><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">In terms of not being employable, the lack of a college education again does not tell the whole story. A low-level employee interacting regularly with customers gets heat from a manager if the attitude is, "I can't be wrong about X." Lying about the customer is also not acceptable. Impulse control is vital to virtually any vocation.&nbsp;</span><br /><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">A day after Thanksgiving in 2017, I faced a middle-aged cashier who insisted that people could refuse to recognize that it was Thanksgiving and instead <i>validly </i>select another holiday to celebrate that day, including Christmas and even July 4th.&nbsp; I countered that Thanksgiving and the other two holidays are set by the U.S. Government, and so are on determined days.&nbsp; She dismissed this out of hand, which was insulting, and repeated, "It can be any holiday you select." She refused to resist her impulse that she must be right even though she was wrong. "No, yesterday was Thanksgiving and this is Thanksgiving weekend--not another holiday," I insisted, but she rigidly held on to her ignorance as if it could be right. Rather than use self-discipline even to <i>consider </i>that she may have been wrong, she failed to resist the impulse of the presumption of being right <i>and being dismissive.</i></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">I submit that a culture exists in the poor America that involves not only a difference in wealth and even education-level, but and most crucially in the attitude toward and practice of impulse-control. That is, being inconsiderate, lying, and feeling entitled in being infallible about what a person thinks one knows can become salient norms where enough uneducated poor live. The attitude thinks it receives confirmation because other people in a similar way also have it. The poor are very susceptible to being rude, lying, and using drugs because of ill-used or perhaps impaired impulse-control. Viewing such restraint as of nugatory value, it is easy to be inconsiderate, rude, even highly aggressive (given the overblown or even imagined slights or provocations).</span><br /><span style="font-family: Times, Times New Roman, serif; font-size: large;"><span style="font-family: Times, Times New Roman, serif; font-size: medium;">Biking in poor areas near universities, I have noticed the extreme “road-rage” that is distinct among poor drivers. Today in fact, I witnessed one driver get out of his car to shout at the driver in front of him at a red light. The aggressor showed absolutely no impulse-control; his emotions were out of control. Similarly, I've seen poor drivers much, much more than other drivers lose complete control of themselves emotionally and because apparently I had no right to bike on the side of the roads along the curbs! The sheer aggressiveness, outstripping any rational basis in the context itself, has both amazed me and formed in my mind an image of the typical poor driver.&nbsp;</span>My reaction in observing such drivers has been that such people must surely live in a very different world. I couldn't imagine anyone with such pathetic impulse control being in college or holding a job. Clearly, another America exists,&nbsp;with its own mores and values that retain the inhabitants from entering (and being accepted in!) polite society. Being in the habit of evading impulse-control is so different than valuing such internal control that “Two Americas” can be so explained. Both in terms of wealth and, if the stats on drug and alcohol abuse are correct, impulse-control, the America that is expanding is not the one that&nbsp;<i>should be</i>.</span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">If I am correct in my analysis here, simply providing more and better jobs, creating labor unions and other ways for poor people to “get involved” or be in a group only touch the surface, and thus cannot get the job done in eliminating poverty. Even if "ghetto" apartment complexes are "broken up," with the very poor being disbursed such that they cannot form a culture of least resistance, the <i>internal </i>attitude with respect to impulse-control is surely very difficult to change. So study of precisely how such a feat may be accomplished is needed.&nbsp;</span><br /><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span><br /></div><div><!--[if !supportEndnotes]--> <br /><hr align="left" size="1" width="33%" /><!--[endif]--> <br /><div id="edn1"><div class="MsoEndnoteText"><a href="file:///C:/Users/Nietzsche/Documents/Blog%20Posts/Modern%20Society/Mentality%20of%20the%20poor.docx#_ednref1" name="_edn1" title=""><span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="font-family: &quot;calibri&quot; , &quot;sans-serif&quot;; font-size: 10.0pt; line-height: 115%;">[1]</span></span><!--[endif]--></span></a>Gregory Korte, “U.S. Waging Tech War against Opioid Epidemic,” <i>USA Today</i>, November 24-26, 2017. <o:p></o:p></div></div><div id="edn2"><div class="MsoEndnoteText"><a href="file:///C:/Users/Nietzsche/Documents/Blog%20Posts/Modern%20Society/Mentality%20of%20the%20poor.docx#_ednref2" name="_edn2" title=""><span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="font-family: &quot;calibri&quot; , &quot;sans-serif&quot;; font-size: 10.0pt; line-height: 115%;">[2]</span></span><!--[endif]--></span></a>Janet Adamy, “’Two Americas,’ Updated,” <i>The Wall Street Journal</i>, November 20, 2017.<o:p></o:p></div></div></div>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comtag:blogger.com,1999:blog-5896319920382721541.post-33146204622576253952017-10-25T15:00:00.000-07:002017-10-25T15:00:04.862-07:00On the Myopic Hyperbole of Wall Street: Overblowing Small Changes<div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">I suppose that after looking at something closely for a long period of time, virtually anyone would perceive a small change in it as huge. This is reflected in how people formulate graphs. In particular, typically only a small interval is shown, the perceptual impact of which is that small changes&nbsp;<i style="mso-bidi-font-style: normal;">look&nbsp;</i>big. For example, msnbc.com reported on June 8, 2011 that the price of oil “soared” on that day “almost $2 to near $101 a barrel.” My reaction in reading the report was that the word “soared” indicates a lack of perspective on Wall Street and the media.</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">To be sure, a graph showing the price of oil with the y-axis running from $98 to $102 would show what looks like a huge increase, while a y-axis extending from $0 to $150 would show a barely noticeable change on June 8<sup>th</sup>.<span style="mso-spacerun: yes;">&nbsp;&nbsp;</span>The second graph would be more accurate in terms of the significance of the change.</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">The modest increase in price was momentary, caused by investors who had shorted oil and wanted to get out because of a bearish expectation. On June 8<sup>th</sup>, the Organization of Petroleum Exporting Countries (OPEC) talks broke down without an agreement to raise output after Saudi Arabia failed to convince the cartel to lift production. Iran, Libya, Iraq and other oil-producing states wanted to hold production targets while Saudi Arabia sought to raise them so the price of oil would stabilize at between $70 and $80 a barrel. Wise, long-term-oriented Saudi government officials understood that stability rather than short-term windfalls is in the long-term best economic interest of oil exporters—especially if oil is the&nbsp;<i style="mso-bidi-font-style: normal;">sole&nbsp;</i>export. According to&nbsp;The Wall Street Journal,<em>&nbsp;</em>"In the wake of the failure to reach agreement, people familiar with the matter said the Saudis are now likely to unilaterally increase their own production by up to one million barrels a day, which would put them well above their stated quota of eight million barrels a day." The Saudi assurance that it would supply the needs of the oil market regardless of OPEC left investors bearish after the meeting, and short-sellers were simply unloading. To report that the price of oil “soared” by $2 after the meeting is utterly misleading. By the end of trading for the day, oil was up just $1.65 (at $100.74).</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">Even by Wall Street’s own mantra wherein investors tend to do well in the stock market by holding a well-diversified position for a long time, over-dramatic renderings of short-term changes are counter-productive because they can seduce long-term investors to&nbsp;<i style="mso-bidi-font-style: normal;">react</i>. If newscasters on CNBC are announcing that the sky is falling today because oil went up $2, the temptation is to&nbsp;<i style="mso-bidi-font-style: normal;">do something</i>.&nbsp;<span style="mso-spacerun: yes;">&nbsp;</span><i style="mso-bidi-font-style: normal;">Anything</i>.<span style="mso-spacerun: yes;">&nbsp;&nbsp;</span>Acting at all would be at odds with taking a long-term position in the market, tweeking it only to maintain a diversified portfolio.</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">I suspect that cause of the hyperbole is tunnel-vision, which is caused by zeroing in on something too closely and for too long. At the very least, it might be a bad idea for Wall Streeters to develop some hobbies that have nothing to do with work. Also, analysts might avoid the temptation to pay so much attention to the talking heads on CNBC. Furthermore, analysts might resist orienting graphs to overplay small changes by artificially restricting the interval on the y-axis. Lastly, Wall Streeters might resist the fun in using overly-dramatic jargon or loose-fitting (at best) analogies.</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">If the stock market is “crashing,” for example, we had better be talking about&nbsp;<i style="mso-bidi-font-style: normal;">thousands&nbsp;</i>rather than hundreds of points lost on the Dow. A plane going from 12,000 to 11,500 feet is not crashing; it is probably just making way for another plane. If a company is getting “killed,” it better be in liquidation without anything going to equity or bond holders. Better still, analysts would gain credibility if they stayed away from the military jargon completely; at the very least, using the vocabulary is an insult to the brave men and women who&nbsp;<i style="mso-bidi-font-style: normal;">really have&nbsp;</i>put their lives on the line.</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">In short, Wall Street could do with a dose of&nbsp;<i style="mso-bidi-font-style: normal;">perspective</i>. Such a change would be in line not only with credibility and reputational capital, but also how Wall Streeters fare in the market. As one person might say to another who has been dumped romantically,&nbsp;<i style="mso-bidi-font-style: normal;">don’t over-analyze it</i>!</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><br /></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><br /></div><div class="MsoNormal" style="margin: 0in 0in 0pt;">Sources:<br /><br />Summer Said, Hassan Hafidh, and Benoit Faucon, "<a href="http://online.wsj.com/article/SB10001424052702304259304576373150163060100.html?mod=ITP_pageone_0">New Cracks in Oil Cartel</a>,"&nbsp;<em>The Wall Street Journal</em>, June 9, 2011, p. A1.</div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><br /></div><div class="MsoNormal" style="margin: 0in 0in 0pt;">“<a href="http://www.msnbc.msn.com/id/43325009/ns/business-oil_and_energy/">Oil Price Soars after OPEC Talks Yield No Agreement</a>,” msnbc.com, June 8, 2011.<br /><div><br /></div></div>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comtag:blogger.com,1999:blog-5896319920382721541.post-64180811501305382112017-10-25T14:49:00.000-07:002017-10-25T14:49:41.421-07:00The Fiat 500: The American Taste for Convenience Revealed<div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">One means of doing cross-cultural comparison is by contrasting consumer tastes; such proclivities tend to evince societal mores by which societies can be perceived to be distinctive. In the case of the E.U. and U.S., Fiat, a European auto company that controls Chrysler, an American company, is discovering some societal differences as it refashions the Fiat 500 for American customers.</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">For example, the pod of drink holders had to be enlarged to hold American-size “supersize” drinks. According to Fabio DiMuro, chief engineer of the 500, the in-car beverage concept is so foreign to Europeans that the workers didn’t understand his exhortations for more and bigger holders. The American taste for larger portions is known to restaurant owners and managers in the United States, but what does the preference say about the society and its people? Is it as simple as greed—a desire for&nbsp;<i style="mso-bidi-font-style: normal;">more&nbsp;</i>and to excess? Or is it simply a preference for convenience—filling up more so the next meal can be pushed back to make room for other activities?<span style="mso-spacerun: yes;">&nbsp;</span></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">In terms of convenience, “Americans consider all-season tires a must,” whereas Europeans keep two sets (which must be changed with the advent of the snow season). Of course, this comparison over-generalizes, for we are talking about the Northern states in the E.U. and U.S. Even so, the northerners in America tend to be willing to sacrifice some traction in the snow for the convenience of not having to take the car to the garage to have the tires changed.</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">Furthermore, the fuel tank of the 500 was enlarged from 10.6 to 14.5 gallons “for longer distances typical in the U.S.”<span style="mso-spacerun: yes;">&nbsp;&nbsp;</span>The larger tank also enables American in-town drivers to drive more before having to fill up. The interstate highway system sports enough gas stations that the longer-distances rationale is perhaps specious; it probably comes from the European misconception of the U.S. being like one of the E.U.’s countries but with a larger territory. The U.S., an empire-level union of republics, is qualitatively as well as quantitatively distinct from a large state like Texas or France.</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">Returning to the matter of convenience, the comfort-factor may be a relevant difference. The U.S., having excelled in terms of material goods in the decades after World War II, may in the twenty-first century be more accustomed to comfort. Hence, the American 500 is to have an armrest added to the driver’s seat.</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">A stress on comfort may also explain why “lots more” insulation is needed in the American 500, “to keep it quiet enough for Americans.” This is a rather odd phrase, considering the growth of the car stereo industry in the 1970s and 1980s. Nevertheless, the notion of one’s car as a personal cocoon of sorts resonates. Might this be a manifestation of the individualism for which Americans are so well known?<span style="mso-spacerun: yes;">&nbsp;</span></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">If one’s home is one’s castle, one’s car might be one’s bubble through which one passes through public space. Considering the “road rage” phenomenon and general impoliteness, the greater insulation might suggest that Americans are in general rather unfriendly when we are out and about.</span> <span style="font-family: Times, Times New Roman, serif; font-size: large;">Hence there are “screening” devices such as fraternities and sororities, as well as country clubs and other private associations. The general American public may contain too many loud, pushing or boorish people to be palatable to the elite.</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">In general, James Healey’s article on the American Fiat 500 is not flattering to Americans, but perhaps Healey is pointing to indications of undesirable traits that we (for I am an American) should face about ourselves and our society. I for one have noticed that where strangers communicate without any purpose, such as in a store, politeness is the norm. However, as soon as a purpose is added, such as buying and selling a car, renting an apartment or room, or resolving a bill at a restaurant, presumptuous tends to raise its ugly head.</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">I don’t know if it is arrogance or a presumption that the worst is apt to be in others, but I would not disagree with a European assessment of American society in general as anti-social or antagonistic. It is perhaps no wonder that houses are castles and cars are insulated bubbles. Of course, I am over-generalizing, as the U.S. is composed of various cultures. Once flying from New York to Seattle, I was struck by the difference in how strangers treated each other; then I realized (aided by a few anti-New Yorker comments from Seattle airport employees) I had just flown over a continent! To render a continent as akin to a European state writ large is to miss the vital distinction between an empire and a kingdom politically and geographically.</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">Another possible source of my over-generalizing may be that modern society itself could be too much inclined to the road of most convenience.<span style="mso-spacerun: yes;">&nbsp;&nbsp;</span>Europeans may have their rankles as well, even as they differ from those of Americans. For example, the whole “peers/commoners” thing can be read as a matter of convenience by some at the expense of others. Such a matter of convenience is not apt to show up in an analysis of the Fiat 500. In general, we&nbsp;<i style="mso-bidi-font-style: normal;">moderns&nbsp;</i>may be too spoiled and too presumptuous when it comes to dealing with strangers. Humility, it seems, is out of fashion in modernity, at least in the public square. If so, my cultural critique goes well beyond the American shores. Although war and poverty are not to be wished for, it would be nice if greater human solidarity could be realized amid our lattes and 500s.</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><br /></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><br /></div><div class="MsoNormal" style="margin: 0in 0in 0pt;">Source:</div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><br /></div><div class="MsoNormal" style="margin: 0in 0in 0pt;">James Healey, “<a href="http://m.usatoday.com/article/money/47855892?preferredArticleViewMode=single">Fiat 500: Little Car Shoulders Huge Responsibility in U.S.</a>,”&nbsp;<i style="mso-bidi-font-style: normal;">USA Today</i>, June 1, 2011, p. 5B.</div>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comtag:blogger.com,1999:blog-5896319920382721541.post-44774079077753221212017-10-23T15:52:00.002-07:002017-10-23T15:56:17.405-07:00On the Unfairness of the Bonus System on Wall Street<div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><span lang="EN" style="mso-ansi-language: EN;">Craig A. Dubow, Gannett’s former chief executive, had a short six-year tenure that was, by most accounts according to&nbsp;<i style="mso-bidi-font-style: normal;">The New York Times</i>, “a disaster.” David Carr reports: “Gannett’s stock price declined to about $10 a share from a high of $75 the day after [Dubow] took over; the number of employees at Gannett plummeted to 32,000 from about 52,000, resulting in a remarkable diminution in journalistic boots on the ground at the 82 newspapers the company owns. . . .&nbsp;<span style="mso-spacerun: yes;">&nbsp;</span>the company strip-mined its newspapers in search of earnings, leaving many communities with far less original, serious reporting. . . . Not only did Mr. Dubow retire under his own power because of health reasons, he got a mash note from Marjorie Magner, a member of Gannett’s board, who said without irony that ‘Craig championed our consumers and their ever-changing needs for news and information.’ But the board gave him far more than undeserved plaudits. Mr. Dubow walked out the door with just under $37.1 million in retirement, health and disability benefits. That comes on top of a combined $16 million in salary and bonuses in the last two years.”<o:p></o:p></span></span></div><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div><div style="text-align: justify;"><span lang="EN" style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large; mso-ansi-language: EN;">Besides the inherent unfairness in an incompetent manager getting millions of dollars in compensation (for championing incompetence?), it is morally problematic when, as Carr puts it, “the consequences of bad decisions land on everyone except those who made them.” As already pointed out above, in the midst of Dubow’s “championing” (this word is so broad it has scarce any real meaning), “the number of employees at Gannett plummeted to 32,000 from about 52,000.” One could just as easily point to Bank of America’s downsizing of its labor force in the wake of Ken Lewis’ shopping spree at Countrywide and Merrill Lynch. Lewis really did exemplify the “walmart” mentality applied to banking: an almost-complete indifference to quality in a desire to be everything to everyone. The “exporting” of bad consequences while exuberant rewards are retained indicates that the corporate executive compensation system in the United States is fundamentally broken. The fixation on aligning an executive’s incentives with the financial enrichment of the stockholders has not functioned as anticipated.<o:p></o:p></span></div><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div><div style="text-align: justify;"><span lang="EN" style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large; mso-ansi-language: EN;">For one thing, the vesting of stock, which is meant to orient an executive to the&nbsp;<i style="mso-bidi-font-style: normal;">longer term&nbsp;</i>financial interest of the stockholders, is typically bypassed as an executive gets the equivalent in cash (or stock) from his or her new employer. An executive can thus discount having to look out for the eventual downside in his or her decisions.<o:p></o:p></span></div><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div><div style="text-align: justify;"><span lang="EN" style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large; mso-ansi-language: EN;">Moreover, the sheer amount of the compensation cannot be justified on the basis of a competitive upper echelons labor market (which functions more like an oligarchy). Indeed, the degree of fixation on the bonus system alone has resulted in larger payouts (as executives make decisions primarily from the standpoint of the impact on their bonus). David Carr points to the excess as mentioned in a&nbsp;<i style="mso-bidi-font-style: normal;">USA Today&nbsp;</i>editorial: “The bonus system has gone beyond a means of rewarding talent and is now Wall Street’s primary business. Institutions take huge gambles because the short-term returns are a rationale for their rich payouts. But even when the consequences of their risky behavior come back to haunt them, they still pay huge bonuses.” Carr’s overall point is that this hypertrophy allies to corporate America—not just Wall Street, though certainly it is salient there too.<o:p></o:p></span></div><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div><div style="text-align: justify;"><span lang="EN" style="mso-ansi-language: EN;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">When John Thain of Merrill Lynch gave lip-service to serving the stockholders, even his own subordinates knew he was more concerned with having to play second fiddle to Ken Lewis at Bank of America than with keeping Merrill’s stockholders from losing everything (as Lehman Brothers’ stockholders did). Even as Fleming got $29 per share as a buyout price from Lewis, Thain preferred a line of credit of billions from Goldman Sachs in exchange for a 10% ownership that would keep Thain on top. That was Thain’s driving motivation: to remain CEO. Meanwhile, the general public&nbsp;<i style="mso-bidi-font-style: normal;">assumed&nbsp;</i>that CEOs, including Thain, were motivated to act in their stockholder interests—that boards of directors insisted on this agency. However, where a CEO is focused on his or her bonus (Thain insisted on $40 million cash bonus even as Merrill was losing billions) and position (and thus future bonuses)&nbsp;<i style="mso-bidi-font-style: normal;">and&nbsp;</i>the CEO&nbsp;<i style="mso-bidi-font-style: normal;">controls&nbsp;</i>“his or her” board, the stockholders are in actuality left unknowingly fluttering in the wind—relying on a system of executive compensation that supposedly aligns the executives’ motivation with the financial interests of the stockholders. Much too much is being assumed here, yet assumptions, like habits, are difficult to break.</span><o:p></o:p></span></div><br /><br /><span lang="EN" style="mso-ansi-language: EN;">Source:<o:p></o:p></span><br /><br /><span lang="EN" style="mso-ansi-language: EN;">&nbsp;</span><span lang="EN" style="mso-ansi-language: EN;">David Carr, “Why Not Occupy Newsrooms?”&nbsp;<i style="mso-bidi-font-style: normal;">The New York Times</i>, October 24, 2011.&nbsp;<a href="http://www.nytimes.com/2011/10/24/business/media/why-not-occupy-newsrooms.html"><span style="color: blue;">http://www.nytimes.com/2011/10/24/business/media/why-not-occupy-newsrooms.html</span></a></span>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comtag:blogger.com,1999:blog-5896319920382721541.post-79072601768934422432017-10-16T15:20:00.001-07:002017-10-16T15:20:02.959-07:00An Ethical Dilemma for Cell-Phone Companies? Drivers Who Text & Talk<div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Long before cellphones became ubiquitous, industry pioneers were aware of the risks of multitasking behind the wheel. Their hunches have been validated by many scientific studies showing the dangers of talking while driving and, in 2009, of texting. Despite the mounting evidence, the industry built itself into a $150 billion business in the United States largely by winning over a crucial customer: the driver. For years, it marketed the virtues of cellphones to drivers. Indeed, the industry originally called them car phones and extolled them as useful status symbols in ads, like one from 1984 showing an executive behind the wheel that asked: Can your secretary take dictation at 55 MPH? “That was the business,” said Kevin Roe, a telecommunications industry analyst since 1993. Wireless companies “designed everything to keep people talking in their cars.”&nbsp;The CTIA, the industry’s trade group, supported legislation banning texting while driving. It has also changed its stance on legislation to ban talking on phones while driving — for years, it opposed such laws;&nbsp;then&nbsp;it&nbsp;became neutral. “This was never something we anticipated,” Mr. Largent, head of the CTIA, said in 2009.&nbsp; However, Bob Lucky, an executive director at Bell Labs from 1982-92, said he knew that drivers talking on cellphones were not focused fully on the road. But he did not think much about it or discuss it and supposed others did not, either, given the industry’s booming fortunes. “If you’re an engineer, you don’t want to outlaw the great technology you’ve been working on,” said Mr. Lucky, now 73. “If you’re a marketing person, you don’t want to outlaw the thing you’ve been trying to sell. If you’re a C.E.O., you don’t want to outlaw the thing that’s been making a lot of money.”&nbsp;One researcher who spoke up about his concerns was quickly shut down. In 1990, David Strayer, a junior researcher at GTE, which later became part of Verizon, noticed more drivers who seemed to be distracted by their phones, and it scared him. He asked a supervisor if the company should research the risks. “Why would we want to know that?” Mr. Strayer recalled being told. He said the message was clear: “Learning about distraction would not be very helpful to the overall business model.” So why did the industry lobby turn to neutral in 2009, when it had for&nbsp;years resisted any governmental regulation on cell phones?&nbsp;</span></div><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">It is important to remember the rationale of the “overall business model”&nbsp;so we don’t project some sort of fuzzy corporate social responsibility motive.&nbsp;&nbsp;&nbsp;The industry’s shift to neutral matches a trend in its bottom line: &nbsp;in the 1980s and early ’90s, wireless companies got 75 percent or more of their revenue from drivers, a figure that fell below 50 percent by the mid-’90s and is&nbsp;by 2009&nbsp;below 25 percent.&nbsp; The negative publicity on cellphones from distracted drivers killing people could cost the industry more (in dollars and cents) than what it could otherwise make by selling phones to more drivers.&nbsp;&nbsp;&nbsp;&nbsp; Public affairs offices and industry lobby groups are simply reflections of the financial interest of the “business model.”&nbsp;&nbsp; We ought not be fooled, as if an industry suddenly sees the light and does what is right.&nbsp; Of course, it is in the financial interest of an industry to have us view it as such, but this is of course just more of the same.&nbsp;&nbsp; Remember that the cell phone industry had reason to know of the problem of distracted drivers but ignored it in following a single-minded profit trajectory.</span></div><br />Source:&nbsp;<a href="http://www.nytimes.com/2009/12/07/technology/07distracted.html?ref=business"></a><a href="http://www.nytimes.com/2009/12/07/technology/07distracted.html?ref=business">http://www.nytimes.com/2009/12/07/technology/07distracted.html?ref=business</a>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comtag:blogger.com,1999:blog-5896319920382721541.post-11972107388769423362017-10-14T15:03:00.000-07:002017-10-14T15:03:24.033-07:00Google’s Philanthropy: $1 Billion to Tech-Train America’s Unemployed<div class="MsoNormal" style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">In October 2017, Sundar Pichai, CEO of Google, announced that the company would give $1 billion over the next five years to nonprofit organizations that help people “adjust to the changing nature of work.”<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="line-height: 115%;">[1]</span></span><!--[endif]--></span>The digital skills philanthropic venture would essentially help otherwise unemployed Americans get jobs that require high-tech skills. This would also enable more people to <i>use </i>the internet, and thus the company’s products. So a reporter at <i>USA Today </i>can be said to gild the lily a bit in claiming that the initiative “is a tacit acknowledgement from one of the world’s most valuable companies that it bears some responsibility for rapid advances in technology that are radically reshaping industries and eliminating jobs in the U.S. and around the world.”<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="line-height: 115%;">[2]</span></span><!--[endif]--></span>I submit that it is highly unlikely that such an acknowledgement ever took place at Google, given the more likely scenario wherein the company’s management saw an opportunity to enlarge (and hopefully enrich) its labor pool and customer base. <o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">In making the announcement from Pittsburgh, Pichai observed, “One-third of jobs in 2020 will require skills that aren’t common [in 2017]. It’s a big problem.”<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="line-height: 115%;">[3]</span></span><!--[endif]--></span> Indeed. He may in fact have been understating it. Giving $10 million to Goodwill’s Digital Career Accelerator so it could “provide 1 million people with access to digital skills and career opportunities” does not necessarily mean that 1 million people would become <i>proficient </i>at such skills, which after all are not easy to master. There is also the matter of <i>attitude</i>, which can function as a wedge between digital skills and realized <i>and sustained </i>career opportunities. Chronic unemployment itself can test and even twist a person’s attitude, which can also be a factor in a person’s unemployment in the first place. <o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">Generally speaking, funneling a society’s extant labor force and the unemployed through a skills-filter, in this case, digital skills, ignores the innate diversity that exists within any societal labor pool (and society itself). The heterogeneous nature of people vocationally is happily in line with the fact that a diversified economy is more stable than one that privileges a certain sector or even its skill-set. </span><o:p></o:p></div><br /><div><!--[if !supportEndnotes]--><br clear="all" /> <hr align="left" size="1" width="33%" /> <!--[endif]--> <div id="edn1"> <div class="MsoEndnoteText"><span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="font-family: &quot;Calibri&quot;,&quot;sans-serif&quot;; font-size: 10.0pt; line-height: 115%; mso-ansi-language: EN-US; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: &quot;Times New Roman&quot;; mso-bidi-language: AR-SA; mso-bidi-theme-font: minor-bidi; mso-fareast-font-family: Calibri; mso-fareast-language: EN-US; mso-fareast-theme-font: minor-latin; mso-hansi-theme-font: minor-latin;">[1]</span></span><!--[endif]--></span>Jessica Lynn, “<a href="https://www.usatoday.com/story/tech/2017/10/12/google-give-1-billion-nonprofits-help-americans-get-jobs-new-economy/756703001/">Google to Give $1 Billion to Nonprofits and Help Americans Get Jobs in the New Economy</a>,” <i>The New York Times</i>, October 12, 2017.<o:p></o:p></div></div><div id="edn2"> <div class="MsoEndnoteText"><span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="font-family: &quot;Calibri&quot;,&quot;sans-serif&quot;; font-size: 10.0pt; line-height: 115%; mso-ansi-language: EN-US; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: &quot;Times New Roman&quot;; mso-bidi-language: AR-SA; mso-bidi-theme-font: minor-bidi; mso-fareast-font-family: Calibri; mso-fareast-language: EN-US; mso-fareast-theme-font: minor-latin; mso-hansi-theme-font: minor-latin;">[2]</span></span><!--[endif]--></span>Ibid.<o:p></o:p></div></div><div id="edn3"> <div class="MsoEndnoteText"><span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="font-family: &quot;Calibri&quot;,&quot;sans-serif&quot;; font-size: 10.0pt; line-height: 115%; mso-ansi-language: EN-US; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: &quot;Times New Roman&quot;; mso-bidi-language: AR-SA; mso-bidi-theme-font: minor-bidi; mso-fareast-font-family: Calibri; mso-fareast-language: EN-US; mso-fareast-theme-font: minor-latin; mso-hansi-theme-font: minor-latin;">[3]</span></span><!--[endif]--></span>Ibid.<o:p></o:p></div></div></div>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comtag:blogger.com,1999:blog-5896319920382721541.post-16358227940002709872017-10-07T13:43:00.000-07:002017-10-07T13:56:07.333-07:00Investment Bank Dinners with Corporate Executives and Hedge Fund Managers: The General Public Not Admitted<div style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; text-align: justify;"><span style="font-size: large;"><span style="background-color: #999999;"><span lang="EN" style="color: black; mso-ansi-language: EN;">The Case Study</span><span lang="EN" style="color: black; mso-ansi-language: EN;">:</span></span></span></div><div style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; text-align: justify;"><span style="background-color: #999999; font-size: large;"></span><br /></div><div style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; text-align: justify;"><span lang="EN" style="background-color: #999999; color: black; font-size: large;">“One day in early March [2011], the phone lines of hedge-fund traders around London and New York suddenly lit up. A stock that many of them had placed hefty bets on—Pride International Inc., an energy company in the process of being sold to a rival—was falling. The traders had no idea why. They soon figured it out: J.P. Morgan Chase &amp; Co. had hosted a meeting that day between a handful of hedge-fund traders and executives from a company that was considered a prime candidate to start a bidding war for Pride. One of those executives had indicated they weren't likely to make a bid.”</span></div><div style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; text-align: justify;"><span style="background-color: #999999; font-size: large;"></span><br /></div><div style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; text-align: justify;"><span lang="EN" style="color: black; mso-ansi-language: EN;"><span style="background-color: #999999; font-size: large;">“The prospect of a bidding war had lifted Pride's shares above where they likely would have traded in the absence of a potential interloper</span><a href="http://www.blogger.com/" name="U402161697450VJE"></a><span style="background-color: #999999; font-size: large;">. . . . At the March 8 lunch, though, as the traders munched on scallops and fish, Seadrill vice president and board member Tor Olav Trøim splashed cold water on the idea of a bid. He recalls telling traders that the company's Feb. 24 statement was ‘not normally what you would say if you were interested in bidding yourself. His intended message, according to one person familiar with the matter, is that Seadrill was "very unlikely’ to launch a competing offer for Pride.</span><a href="http://www.blogger.com/" name="U402161697450MXH"></a><span style="background-color: #999999; font-size: large;">&nbsp;The information was market-moving, traders say. In the hours after the lunch, some traders wagered that the odds of a bidding war had declined. Seadrill's shares rose more than 1% as it was viewed as less likely to pursue a costly acquisition. Pride's shares fell by about 0.5% in the minutes before markets closed.”</span></span></div><div style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; text-align: justify;"><span style="background-color: #999999; font-size: large;"></span><br /></div><div class="separator" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; clear: both; text-align: justify;"><a href="http://1.bp.blogspot.com/-YlUdLnbep9w/TdIMEJw_6BI/AAAAAAAAAGI/UUjQhB715iM/s1600/insider+trading+at+banks+and+hedge+funds.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><span style="background-color: #999999; font-size: large;"><img border="0" height="320" j8="true" src="https://1.bp.blogspot.com/-YlUdLnbep9w/TdIMEJw_6BI/AAAAAAAAAGI/UUjQhB715iM/s320/insider+trading+at+banks+and+hedge+funds.jpg" width="197" /></span></a></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span style="background-color: #999999; font-size: large;"></span><br /></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span lang="EN" style="color: black; mso-ansi-language: EN;"><span style="background-color: #999999; font-size: large;">“The moves may seem small, but they were significant for ‘merger arbitrage’ traders, who make short-term bets on deal stocks. In the case of the Ensco-Pride deal, the movements translated into a sudden 64% spike in the deal's ‘spread.’ That arcane measure reflects the difference between a target company's stock price and the per-share value of the acquirer's offer. The spread is closely watched by hedge funds that focus on merger arbitrage, which stand to gain or lose large sums based on the spread's movement.</span><a href="http://www.blogger.com/" name="U402161697450Z2F"></a><span style="background-color: #999999; font-size: large;">&nbsp;As the shares moved, anxious investors bombarded Seadrill's investor-relations office with phone calls, trying to figure out whether the company had issued new guidance about its appetite for bidding on Pride, according to a person familiar with the matter. Company officials responded that they hadn't released any new information. . . . Trøim says Seadrill executives regularly meet with large and small investors and that it is appropriate to help them understand the company's strategy. ‘We cannot see that we in any way have crossed any lines for giving privileged information,’ he says.”</span></span></div><div style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; text-align: justify;"><span style="background-color: #999999; font-size: large;"></span><br /></div><div style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; text-align: justify;"><span lang="EN" style="color: black; mso-ansi-language: EN;"><span style="mso-spacerun: yes;"></span><span style="background-color: #999999; font-size: large;">The Issues:</span></span></div><div style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; text-align: justify;"><span style="background-color: #999999; font-size: large;"></span><br /></div><div style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; text-align: justify;"><span lang="EN" style="background-color: #999999; color: black; font-size: large;">“Hedge funds are a big business for banks. U.S. and European hedge funds last year shelled out a total of about $3.7 billion in brokerage commissions to banks for equity trades, according to research firm Greenwich Associates. . . . Investment banks vie for business from elite hedge funds by offering traders at those funds special access to senior deal makers and corporate executives at dinners and other gatherings. The traders sometimes pick up valuable nuggets of information that aren't available to other investors, according to people who have attended such gatherings.”</span></div><div style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; text-align: justify;"><span style="background-color: #999999; font-size: large;"></span><br /></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span lang="EN" style="background-color: #999999; color: black; font-size: large;">“Representatives of the banks say their investment bankers aren't permitted to discuss material nonpublic information, and that the meetings serve a legitimate business purpose. In addition to helping the banks win trading business, the get-togethers allow the bankers and corporate executives to cultivate relationships with the hedge funds, the banks say. The funds often are major shareholders in multiple companies and frequently help determine the outcome of key corporate events that are subject to shareholder approval, such as mergers and acquisitions.”</span></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span style="background-color: #999999; font-size: large;"></span><br /></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span lang="EN" style="background-color: #999999; color: black; font-size: large;">“Amid intensified scrutiny of insider trading, the U.S. Securities and Exchange Commission recently warned some banks that they need to be careful that such meetings don't result in the improper exchange of privileged information, according to people familiar with the matter.”</span></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span style="background-color: #999999; font-size: large;"></span><br /></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span lang="EN" style="background-color: #999999; color: black; font-size: large;">“Under insider-trading laws, it is generally illegal to buy or sell securities based on ‘material,’ or significant, information that isn't publicly available. Securities lawyers say the appropriateness of the meetings banks set up with hedge-fund traders depends on whether such information changes hands and is subsequently traded upon.”</span></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span style="background-color: #999999; font-size: large;"></span><br /></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span lang="EN" style="color: black; mso-ansi-language: EN;"><span style="background-color: #999999; font-size: large;">“It is unclear how often useful trading information is disseminated in the meetings.</span><a href="http://www.blogger.com/" name="U402161697450X6B"></a><span style="background-color: #999999; font-size: large;">&nbsp;The meetings appear to have made some banks nervous. . . . ‘It made me congenitally nervous,’ said a banker who until recently worked at a top Wall Street investment bank. ‘It certainly should be on [regulators'] radar.’ . . . Goldman Sachs Group Inc.'s compliance department [in 2010] barred its brokers from arranging dinner meetings between Goldman's bankers and outside hedge-fund traders, say people familiar with the matter.</span><a href="http://www.blogger.com/" name="U402161697450GZG"></a><span style="background-color: #999999; font-size: large;">&nbsp;Bank of America's investment-banking arm, Bank of America Merrill Lynch, [in 2011] cut down on the gatherings after the SEC expressed concern, although it still allows them in some circumstances, according to people familiar with the matter. Many banks nevertheless continue to hold closed-door meetings with hedge funds on a regular basis, according to traders, bankers and other industry officials. Banks try to differentiate themselves from rivals by dangling access to key players—coveted by hedge funds, for which incremental bits of information can be extremely valuable. The banks also set up lunches and other ‘corporate access’ meetings that give the traders the chance to grill top corporate executives about pending deals and other matters.&nbsp;</span><a href="http://www.blogger.com/" name="U40216169745072C"></a><span style="background-color: #999999; font-size: large;">Such opportunities are rarely available to individuals and other small investors.”</span></span></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span style="background-color: #999999; font-size: large;"></span><br /></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span style="font-size: large;"><span style="background-color: #999999;"><span lang="EN" style="color: black; mso-ansi-language: EN;">Analysis</span><span lang="EN" style="color: black; mso-ansi-language: EN;">:</span></span></span></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span style="background-color: #999999; font-size: large;"></span><br /></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span lang="EN" style="background-color: #999999; color: black; font-size: large;">To keep participants within the world of business from speaking with each other in closer terms than are available to the general public strikes me as utterly fanciful and doomed to failure—especially if a profit relationship is involved. Intimating a company’s strategy alone can proffer hints of information not available to the public and yet useful for trading. Are the courts to become embroiled in interpreting every nuance at every meeting in which investment bankers bring together corporations and hedge funds so they may behave as though in public? Policing such meetings is at best an uphill battle, and more realistically like trying to keep the rising tide back from one’s sand castles. It is the castles that are artificial, not the water presumably to be held back by them.</span></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span style="background-color: #999999; font-size: large;"></span><br /></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span lang="EN" style="background-color: #999999; color: black; font-size: large;">In terms of&nbsp;prohibiting&nbsp;insider-trading more generally, what is really being reputiated or denied is the concentric nature of the respective&nbsp;circles of family, friendships and finally the general public identified by Cicero in his theory of justice wherein&nbsp;<i style="mso-bidi-font-style: normal;">caritas naturalis</i>&nbsp;(natural love)&nbsp;is&nbsp;limited to the circle of&nbsp;<i style="mso-bidi-font-style: normal;">amicitia&nbsp;</i>(friendship). It is just by nature that friends share a love that does not hold in the wider public. This theory of justice is more restricted than the&nbsp;<i style="mso-bidi-font-style: normal;">caritas universalis&nbsp;</i>(universal love)—extending even to strangers—preached by Augustine. That loving strangers is difficult while loving one's friends is easy attests to the qualitiative differences between the concentric circles that inform Cicero's theory of justice, which insider-trading laws contravene.</span></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span style="background-color: #999999; font-size: large;"></span><br /></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span lang="EN" style="background-color: #999999; color: black; font-size: large;">In any social context, friends are not going to behave as though all they know of each other is what the general public knows. Just as it is natural that people closer will exchange more information than people in the wider public, it is also natural for the latter to envy those who are closer except when they themselves are in close relation with their own friends and colleagues. Enforcing publically-available information on business practitioners having mutual dealings is to conflate the widest circle with narrower circles. It is to pretend that&nbsp;<i style="mso-bidi-font-style: normal;">caritas naturalis seu amicitia&nbsp;</i>simply does not exist—that everything is universal rather than natural love being of friendship.</span></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span style="background-color: #999999; font-size: large;"></span><br /></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span lang="EN" style="background-color: #999999; color: black; font-size: large;">Fueling resentment of insider-trading may be our natural distaste for exclusion. As a student at Yale, I felt exclusion when my political party in the Yale Political Union invited me and the other new members to a Friday night party in a room in the clock tower. The chairman told me that we would all be initiated into the party’s secret society because the party owned it; we were members of the party, after all. In actuality, only a few members—those who had new leadership positions in the party—were tapped by the older leadership; the rest of us were invited so there would be an excluded element heightening the feeling of inclusion. My resentment was a function of my illusion (facilitated by the chairman) that an inner circle would treat a wider circle as equivalent.</span></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span style="background-color: #999999; font-size: large;"></span><br /></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span lang="EN" style="background-color: #999999; color: black; font-size: large;">As much as I detest the “insider/outsider” diremption, I must admit that it is a part of the human social condition. As social animals, we naturally find ourselves in relations wherein some people are closer to us than others. We fool ourselves if we presume that people who are closer will somehow open their relations up to a wider circle as if there were no narrower circle. Some of us, however, relish exacerbating the natural distances by excluding others solely for the pleasure of being cruel. For example, I grew up in a family that broke up into two camps, both of which relished excluding a family member. Even though the betrayal in such exclusion was unnatural, I must admit that narrower and wider circles naturally develop as human beings interact.</span></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span style="background-color: #999999; font-size: large;"></span><br /></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span lang="EN" style="background-color: #999999; color: black; font-size: large;">To pretend that there is only a general public is to deny the human condition in its social setting. Insider-trading law may be predicated by a denial of relationships that go beyond the general public.</span></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span lang="EN" style="background-color: #999999; color: black; font-size: large;">Furthermore, the “harm” from insider trading is largely one of opportunity cost, as the benefits obtained by insiders are not shared by the general public. In contrast, the harm from fraud is felt by the victims, who are outsiders. In a wider sense, the systemic risk of the failure of a financial system is shared by the general public. Legislation and enforcement ought to take into account the difference between an opportunity cost and direct harm.</span></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span style="background-color: #999999; font-size: large;"></span><br /></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span lang="EN" style="background-color: #999999; color: black; font-size: large;">Therefore, for the SEC to put resources into insider-trading at the expense of going after banks and other companies that evince systemic risk is something more than misplaced priorities. In terms of punishment, to treat a business practitioner who benefits financially from information overheard from a CEO as though he or she committed fraud by lying to investors or murdered someone is to conflate categories of different degrees of harm.</span></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span style="background-color: #999999; font-size: large;"></span><br /></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span lang="EN" style="background-color: #999999; color: black; font-size: large;">Lastly, human behavior is such that it cannot be totally regulated. Nor can human nature itself manifested socially be remade as though there were just a general public without&nbsp;<i style="mso-bidi-font-style: normal;">caritas naturalis seu amicitia</i>. Business practitioners cannot be held back from exchanging information that is not available to the general public. Like jelly in a hand, the harder you squeeze it the less of it you will have within your grip. The illusion of micro-managing regulation to every facet of business ignores this principle, which is based in human nature rather than artifice.</span></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span style="background-color: #999999; font-size: large;"></span><br /></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><br /></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span style="background-color: #999999; font-size: large;"></span><br /></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span lang="EN" style="background-color: #999999; color: black; font-size: large;">Source:</span></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span style="background-color: #999999; font-size: large;"></span><br /></div><div class="MsoNormal" style="background-attachment: scroll; background-clip: border-box; background-image: none; background-origin: padding-box; background-position: 0% 0%; background-repeat: repeat; background-size: auto; margin: 0in 0in 0pt; text-align: justify;"><span lang="EN" style="background-color: #999999; color: black; font-size: large;">David Enrich and Dana Cimilluca, “</span><a href="http://online.wsj.com/article/SB10001424052748703841904576256520217477678.html?mod=ITP_pageone_0#printMode"><span lang="EN" style="mso-ansi-language: EN;"><span style="background-color: #999999; color: blue; font-size: large;">Banks Woo Funds with Private Peeks</span></span></a><span lang="EN" style="background-color: #999999; color: black; font-size: large;">,”&nbsp;<i style="mso-bidi-font-style: normal;">The Wall Street Journal,&nbsp;</i>May 16, 2011.</span></div><div class="MsoNormal" style="background: white; margin: 0in 0in 0pt; mso-margin-bottom-alt: auto; mso-margin-top-alt: auto;"><br /></div><div style="background: white;"><br /></div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;"></div><br /><div style="-webkit-text-stroke-width: 0px; background: white; color: black; font-family: &quot;Times New Roman&quot;; font-size: medium; font-style: normal; font-variant-caps: normal; font-variant-ligatures: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-decoration-color: initial; text-decoration-style: initial; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px;"><div style="margin: 0px;"><br /></div></div>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comtag:blogger.com,1999:blog-5896319920382721541.post-11674250038543673262017-10-04T11:31:00.001-07:002017-10-04T11:31:58.076-07:00Capitalism and Caste: Artificial vs. Natural<span style="font-size: x-large;"><b>Part I</b></span><br /><br /><span style="font-size: large;"><b>Capitalism &amp; Caste: Melting Untouchability in India</b></span><br /><span style="font-size: x-large;"><br /></span><div style="text-align: justify;"><span style="font-family: &quot;times new roman&quot; , &quot;serif&quot;; font-size: large; mso-fareast-font-family: &quot;Times New Roman&quot;;">In what has become known as India, the caste system of Hinduism has for millennia served as the template for the socio-economic ordering of people into family-based groups. By the end of the first decade of the twenty-first century, the economic liberalization policy put in place in 1991 to replace the stagnant “import-substitution” domestic-favoring model of economic development had enabled some people in the lower castes to vault into social acceptability by virtue of what The New York Times calls “the newest god in the Indian pantheon: money.” Given the advent of the prosperity gospel in Christianity and the associated eclipse of the “camel getting through the eye of a needle” much-earlier-hegemonic association of wealth with greed, a similar statement could be made with regard to the Trinity (see “<a href="http://thewordenreport.blogspot.com/2011/02/godliness-greed-how-effective-is.html">Godliness and Greed</a>” and "God's Gold," both available at Amazon).</span><br /><span style="font-family: &quot;times new roman&quot; , serif;"><span style="font-size: large;">Gandhi is said to have remarked, “I used to think that truth was God. I have realized that God is truth.” This is a very profound statement, which must be unpacked to be understood and appreciated. “God” refers here to what in the Abrahamic religions (Judaism, Christianity and Islam) is called revelation (God revealing itself through scripture). In Hinduism, the basic scriptures are known as the Vedas—the commentary thereof is known as the Upanisads (which are quite rich in terms of religious philosophy). The Vedas contain directions for social practices, such as concern widows (e.g., Sati (throwing oneself on the burning funeral pire of one’s husband) or going into a widows home, which often involved prostitution) and Dalits, or “untouchables” (e.g., not permitted to worship in the temple, or use public drinking fountains—sound familiar?).</span></span><br /><span style="font-size: large;"><span style="font-family: &quot;times new roman&quot; , serif;">Gandhi was saying that he used to accept all that was in revelation—including social practices concerning widows and untouchables—as truth (i.e., as unquestionably valid, or sacred). Observing the suffering of widows and untouchables, he came to realize that to be valid, revelation must itself “pass the truth test.” Suffering of the innocent (Christians may recall the suffering servant motif) as a direct and sole result of a directive in scripture could not be of truth, Gandhi concluded. Truth, in other words, has a higher calling than does revelation. In other words, what humans record as their revelations of the divine should be subject to truth itself, rather than defining (i.e., limiting) it. Even if what the religions record as revelation is informed by a divine source or field, the “informing” must pass through the imperfect (i.e., distortive) atmosphere of the human instruments that do the writing and copying. Therefore, “God is truth” means that truth is rightfully a criterion to be applied to revelation.</span><span style="font-family: &quot;times new roman&quot; , serif;">&nbsp;&nbsp;</span><span style="font-family: &quot;times new roman&quot; , serif;">That which doesn’t pass the “smell test” can rightfully be ignored (I would include a conflict-of-interest criterion to the “smell test”).</span></span><br /><span style="font-family: &quot;times new roman&quot; , serif;"><span style="font-size: large;">The constitution of modern India forbids the old, rather sordid institutional prejudice against widows and the Dalit (which as of this writing number about 200 million). For example, the practice of physical untouchability, which confined Dalits to low-status jobs and social exclusion, is outlawed. Except in some remote areas, Dalits can walk on the same streets as upper-caste Indians, look them in the eye, and drink from the same wells and water fountains.</span></span><br /><span style="font-family: &quot;times new roman&quot; , serif;"><span style="font-size: large;">Even so, as anyone who has stayed in a Motel 6 or Holiday Inn Express owned or operated by a Patel knows, vocational groupings continue to reflect family groupings, or castes. According to the New York Times, “(s)ocial and economic mobility are limited, a product of India’s layers of cultural legacies: the Hindu caste system, the feudal and sometimes racial hierarchies . . ., and the imperial bureaucracy imposed by Britain.” For many Indians still, you do what your father did. The Times reports that “(k)nowledge-based businesses like information technology have attracted large numbers of Brahmins, the traditional learned caste. The business castes tended to focus more on retail and wholesale trade than manufacturing. Messy industries like construction are closer to the traditional occupations of the lowest castes.” That the historical caste of scholars and priests (i.e., the Brahmins) has turned to information technology reflects the new “high priests” in terms of modern Indian values, yet I doubt that contemporary Brahmin scholars and priests view a computer programmer as being at all equivalent. The caste system itself has been truncated by a certain reductionism to business (i.e., oriented to business), given the societal hegemony of business in modern India.</span></span><br /><span style="font-size: large;"><span style="font-family: &quot;times new roman&quot; , serif;">As a brief digression, I want to translate the Hindu caste system into Western society. A learned caste exists in the West, even if that caste has been eclipsed in popular culture by the “professional” sub-caste in the business caste. Even so, scholars and priests in the West correspond to the Indian Brahmin caste. The political caste contains (in decreasing order) imperial, kingdom/state, province/region/county, and local offices. This is so in both India and the West. The business caste in the West contains its own hierarchy, from professionals (physicians, CPA’s and lawyers) to the people who work in the financial services and information technology, and on down to retail managers and finally manufacturers. The worker caste (foreign farm workers being at its bottom) is below the “managerial” sub-caste of the business caste, and the “welfare” or “homeless” caste is perhaps the Western equivalent of the untouchables in India. As in India, the business caste—in particular the professional and managerial sub-castes—has in practice vaulted to being the&nbsp;</span><i style="font-family: &quot;times new roman&quot;, serif;">de facto</i><span style="font-family: &quot;times new roman&quot; , serif;">&nbsp;highest caste in terms of contemporary values. That the Brahmin caste, in having scriptures or treatises as referents that contradict or relativize whatever happens to be the flavor of the month (e.g., “being a professional”), self-consciously transcends or repudiates “professional” values suggests that a basic learned—politics—business order of status (and even class) exists in spite of the apparent societal hegemony of the professionals (in which, not coincidentally, the next-lower business sub-caste, that of the business executive/manager, has claimed membership). Indeed, practically every working adult American who is not a student claims to be a professional (just look at the housing postings on Craigslist). In the U.S., everyone gets to classify oneself as being in the highest sub-caste of business, which in turn is presumed to be the highest caste in the entire system. It is not simply because physicians, public accountants and lawyers can be wealthy; “professional” now conveys a high-class sort of status. So, it would appear there are&nbsp;</span><i style="font-family: &quot;times new roman&quot;, serif;">two&nbsp;</i><span style="font-family: &quot;times new roman&quot; , serif;">new gods in the American pantheon.</span></span><br /><span style="font-family: &quot;times new roman&quot; , serif;"><span style="font-size: large;">In modern India, the “Dalit problem” may reduce in a practical sense to the task of reducing a rather extreme economic inequality, which in itself is dangerous to a representative democracy. Thanks in part to an affirmative action program by the government, Dalits and tribal people have gained in getting an education and procuring government jobs. This is only part of the story, however. Although widening “the gulf between rich and poor,” the economic expansion brought about by the post-1991 liberalization policy allowing foreign direct investment and expanding trade has enabled some Dalits to become wealthy as business practitioners. As a result of both the affirmative action and liberalization policies, the wage gap between other castes and Dalits decreased from 36 percent in 1983 to 21 percent in 2011 (and the education gap has been halved). Twenty-one percent is less than the gap between Caucasian and Black men in the United States in 2011. The social status of Dalits has risen as well. “With their new wealth they have also won a measure of social acceptance,” according to the Times.</span></span><br /><span style="font-family: &quot;times new roman&quot; , serif;"><span style="font-size: large;">According to Chandra Bhan Prasad, a Dalit activist and proponent of capitalism for untouchables, “(b)ecause of the new market economy, material markers are replacing social markers.” This can be generalized to include the self-vaunting of the business caste to the head of the line from third in terms of popular understanding both in India and the West. Prasad implicitly likens India to the West, in fact, by making the following observation: “India is moving from a caste-based to a class-based society, where if you have all the goodies in life and your bank account is booming, you are acceptable.” What of the Brahmin priest or scholar of philosophy who sees through all the vanities in life and appreciates timeless gems that don’t necessary pay a monetary dividend? Is the modern professional society in actuality without class, yet still very hierarchical and unequal? It is indeed part of the role of the scholar and priest to hold this mirror up to the “professionals,” whose niggardly caste does not permit donations to such “lost” causes as that of truth. Am I understood?</span></span><br /><span style="font-size: large;"><span style="font-family: &quot;times new roman&quot; , serif;">As Nietzsche theorizes, the strong can be hoodwinked by the weak who seek to dominate beyond their native pith and ken (e.g., those with an undergraduate degree in Law or Medicine claiming nonetheless a false entitlement to the doctorate—the J.S.D. or D.Sci.M. rather than the LLB/JD or MD prerequisite degrees). Pith, or strength, and ken, or knowledge, may come down in the end to character, out of which real castes naturally form in human relations. What physician is going to party with a scholar who reminds him that his MD is actually an undergraduate degree in a Medical school?—the doctorate being a terminal (highest possible, so not a prerequisite for another degree in the same school/discipline) degree that includes comprehensive (not board) exams and a dissertation-length defended body of original research. What scholar is going to respect a lawyer who cannot be wrong about the LLB (the JD is just another name for that degree) being a doctorate because he or she also has a BA in English? It was student dissatisfaction at around 1900 with the “two B’s” (LLB and BA) that prompted the three lawyers who started new University of Chicago Law School to re-label the LLB program as “JD” (this “D” does&nbsp;</span><u style="font-family: &quot;times new roman&quot;, serif;">not</u><span style="font-family: &quot;times new roman&quot; , serif;">&nbsp;stand for doctorate). In typically American fashion, the marketing gimmick was inexorably taken for substance (because of the convenience) and the misnomer quite understandably became the default rather than recognized as a stubborn category mistake. Substantively, a year or two of basic survey courses and the same time in senior seminars (without even a major!) in the discipline of law does not a doctorate make. Yet this misnomer, and the related one in American medical schools, helped fuel the ascendancy of the “professional” sub-caste of business to the top of the heap, aided by the perennial non-virgin goddess of money.</span></span><br /><span style="font-family: &quot;times new roman&quot; , serif;"><span style="font-size: large;">I contend that the self-vaunting of the “professional” sub-caste in the West is just as squalid (and without foundation) as the historical discrimination against the Dalit in what is now India. Both trajectories violate the ethical principle of desert (i.e., what is deserved) which is related to the principle of fairness. Both “mis-casteings” involve the presumption of knowing more than is actually known in the assigning (and enforcement) of roles. In other words, both are dogmatic, or arbitrary, relative to nature. Rather than looking to capitalism or democracy here, the real lesson is in terms of nature relative to human contrivance. The ancient Greek marble pillars might have been majestic in service to Athena or Poseidon, but green vines would have the last say, as per the painting of the Romantics in the nineteenth century.</span></span><br /><span style="font-family: &quot;times new roman&quot; , serif;"><span style="font-size: large;">Whereas governmental preference and capitalism have enabled an increasing number of Dalits to “join the club” of social acceptance, business and government in the West reinforce the hegemony of the “doctored” professionals who in actuality typically have one (Europe) or two (America) undergraduate degrees. Indeed, kings (raj) and businessmen (as well as Brahmin priests!) in historical India played salient roles in keeping the Dalit in their place as (literally) outcastes. So the value of capitalism and a preferential policy of government should not be over-esteemed in themselves simply because they contributed the upward mobility of some (or many) in the Dalit caste. In the end, above particular economic and political systems as well as historical and even modern societal caste or class systems in which some benefit unduly at the expense of others, lies human character, out of which a rather different, distinctly invisible order of castes naturally unfolds without relying on human intention.</span></span></div><span style="font-size: large;"><br /></span><span style="font-size: large;"><br /></span><b style="font-size: xx-large;">Part II</b><br /><b style="font-size: xx-large;"><br /></b><span style="font-size: large;"><b>Nature’s Caste System: Character-Based Clusters</b></span><br /><span style="font-size: x-large;"><br /></span><div style="text-align: justify;"><span style="font-family: &quot;times new roman&quot; , &quot;serif&quot;; font-size: large; mso-fareast-font-family: &quot;Times New Roman&quot;;">Pushing good characters down for no good reason in a sort of “collective judgment” that applies to an entire group of people—as in the case of the untouchables in the caste system in India—and accepting the false entitlement of “professionals” to membership in the highest caste simply because they tend to be wealthy—as in the case of lawyers and physicians in America—<i style="mso-bidi-font-style: normal;">violates the clusters that naturally cohere—</i>like gases that form distinct planets having their own&nbsp;<i style="mso-bidi-font-style: normal;">separated</i>&nbsp;orbits<i style="mso-bidi-font-style: normal;">—on the basis of character</i>. Being “on one planet,” it is immediately obvious that someone else is on another. In this essay, I attempt to sketch some of the basic mechanisms by which nature’s caste system is sustained and articulate the nature of the differences that occasion there being appreciable distance between the clusters.</span><br /><span style="font-family: &quot;times new roman&quot; , serif;"><span style="font-size: large;">When a stranger is so rude or presumptuous that all you can do is turn and walk away in utter disbelief, for example, you have run into an alien from one of the outer planets. There are many such creatures communicating with us through Craigslist.</span></span><br /><span style="font-size: large;"><span style="font-family: &quot;times new roman&quot; , serif;">A quick read through the housing section (e.g., room shares, apartments for rent) and many “drama-free” private individuals—self-described “professionals”—can be found making demands right off the bat as they seek to attract (?) a future tenant. In actuality, such people are neither “drama-free” nor “professionals.” Both&nbsp;claims are immediately belied by&nbsp;the manner and content of the writing itself.&nbsp;Such people&nbsp;inhabit a sort of low-class society in which they presume themselves as the elite, or rulers. Astonishingly, the presumption is quite without any hint of second-guessing or shame. “YOU MUST . . . ” written in just this way as an&nbsp;</span><i style="font-family: &quot;times new roman&quot;, serif;">advertisement&nbsp;</i><span style="font-family: &quot;times new roman&quot; , serif;">points to the lack of control they have over their urge to dominate from weakness. Furthermore, they are convinced that they cannot be wrong. Some ask for age and others even bring up religion even though doing so is illegal. “No it’s not!” they would undoubtedly reply. They cannot be wrong. As if by sheer reflex, they must surely take any resistance to their presumption as an insult, even an attack, while they continue to hold themselves as blameless. How could they be otherwise? This rock-hard mentality naturally exists in its own “low class” caste in part because it is immune from being corrected or&nbsp;</span><i style="font-family: &quot;times new roman&quot;, serif;">healed</i><span style="font-family: &quot;times new roman&quot; , serif;">. The only thing a healthy person can do is keep reading—avoiding contact at any cost. This reaction is natural; it is thus one of the principal means by which nature enforces the clusters based on character.</span></span><br /><span style="font-size: large;"><span style="font-family: &quot;times new roman&quot; , serif;">Although I have met some really very nice people on twitter, that “universe” sometimes resembles a low-caste society of sorts that is populated, unfortunately, by creatures who seem dominated by an innate urge or proclivity to grant themselves the entitlement of being a&nbsp;</span><i style="font-family: &quot;times new roman&quot;, serif;">self</i><span style="font-family: &quot;times new roman&quot; , serif;">-certified expert. This seems particularly the case in religious or political topics. Opinions are routinely declared as if facts. “X is Y.” Seldom is it asked, “Perhaps X can be Y?” Although certainly not everyone who tweets on leadership does so, some of the so-called leadership “coaches” like to declare their opinions as if knowledge. It is like watching a little populist democracy of self-invented theory that presumes itself to be fully valid upon being tweeted!</span></span><br /><span style="font-size: large;"><span style="text-align: left;"><span style="font-family: &quot;times new roman&quot; , serif;">I have in mind the “coaches” </span></span><span style="font-family: &quot;times new roman&quot; , serif; text-align: left;">who&nbsp;</span><i style="font-family: &quot;times new roman&quot;, serif; text-align: left;">declare</i><span style="font-family: &quot;times new roman&quot; , serif; text-align: left;">&nbsp;<i>as experts&nbsp;</i>&nbsp;that “Leadership&nbsp;</span><u style="font-family: &quot;times new roman&quot;, serif; text-align: left;">is</u><span style="font-family: &quot;times new roman&quot; , serif; text-align: left;">&nbsp;X” without even having bothered to read the academic (i.e. not “how to”) literature on the topic. In fact, these “coaches,” or cockroaches as they are otherwise known, even dismiss that literature, confusing their own self-informed (grade-wise?) declaration, “Leadership can’t be taught in a classroom!” (whereas leadership can be taught in a daylong “seminar” or “workshop” held in a hotel ballroom for a nice fee) with the fact that leadership&nbsp;</span><i style="font-family: &quot;times new roman&quot;, serif; text-align: left;">can</i><span style="font-family: &quot;times new roman&quot; , serif; text-align: left;">&nbsp;be&nbsp;</span><i style="font-family: &quot;times new roman&quot;, serif; text-align: left;">understood</i><span style="font-family: &quot;times new roman&quot; , serif; text-align: left;">. That was an actual tweet, by the way—by an “expert.” It does not matter that such “experts” are not scholars; they presume they know better what is possible in a classroom. Their presumption is thus of an encroaching nature, without any limit of restraint. Such creatures tend to presume on a regular basis that they 1) know what they actually do not know, and</span><i style="font-family: &quot;times new roman&quot;, serif; text-align: left;">&nbsp;</i><span style="font-family: &quot;times new roman&quot; , serif; text-align: left;">2) cannot be wrong about it. They must be from a&nbsp;</span><i style="font-family: &quot;times new roman&quot;, serif; text-align: left;">small</i><span style="font-family: &quot;times new roman&quot; , serif; text-align: left;">, very&nbsp;</span><i style="font-family: &quot;times new roman&quot;, serif; text-align: left;">rocky&nbsp;</i><span style="font-family: &quot;times new roman&quot; , serif; text-align: left;">planet somewhere out past Neptune (a similar species populates my “small” hometown,&nbsp;</span><i style="font-family: &quot;times new roman&quot;, serif; text-align: left;">including</i><span style="font-family: &quot;times new roman&quot; , serif; text-align: left;">&nbsp;its little “professional” elite—an elite that is viewed as such only because a mere 21% of the adult population holds a college degree). Low caste, or&nbsp;</span><i style="font-family: &quot;times new roman&quot;, serif; text-align: left;">class</i><span style="font-family: &quot;times new roman&quot; , serif; text-align: left;">, it turns out, is not necessarily of a low socio-economic (or racial) demographic. This is where the historical Hindu caste system really got it wrong.</span></span><br /><span style="font-size: large;"><span style="font-family: &quot;times new roman&quot; , serif;">Worlds away from “low class” know-it-all&nbsp;</span><i style="font-family: &quot;times new roman&quot;, serif;">attitude</i><span style="font-family: &quot;times new roman&quot; , serif;">—which instantly (and naturally!) relegates a person to a low caste much more than does even the ignorance itself—are the more humble and genuine, flying at a much higher altitude. Such people are open to what they might not know and perhaps they are kind to strangers as a kind of natural default of politeness. If you have been fortunate to have been touched by such a person, you have been touched by a being from a planet closer to the sun. The rest of us do not deserve to be so touched, and we know this. Accordingly, as Nietzsche posits, there is a natural distance that arises between people who differ in terms of character-strength—what he calls noble strength. This is the power of a will that willingly takes on resistance, even and especially&nbsp;</span><i style="font-family: &quot;times new roman&quot;, serif;">within</i><span style="font-family: &quot;times new roman&quot; , serif;">—in self-overcoming.</span></span><br /><span style="font-family: &quot;times new roman&quot; , serif;"><span style="font-size: large;">In Nietzsche’s terms, having the will (and will-power!) to self-overcome one’s own most intransigent internal obstacle—a powerful instinct—proffers the most intense (or powerful) pleasure of power. Having the will and strength to perform such a task on a regular basis (i.e., self-overcoming) naturally builds character (noble strength). In so doing, it naturally separates one from people who take an easier path through life, whether through lack of will, or weakness. In other words, strength of character, an innate quality that I believe a person can strengthen or choose to compromise by will, differs among human beings (no doubt at least in part from upbringing). Such differences constitute the vacuums that inevitably exist between the natural castes that naturally form in the human condition. All other castes, or classes, are dogmatic in the sense that they are arbitrary to that condition.</span></span><br /><span style="font-size: large;"><span style="font-family: &quot;times new roman&quot; , serif;">In expunging the artificial sort such as the Hindu caste system, we should not ignore or dismiss the natural array of castes that we know on a daily basis by means of our natural sentiments of approbation and disapprobation. In fact, David Hume held that such sentiments constitute our recognition of “moral” and “immoral.” Perhaps these terms are but part of a more general sense we naturally have of the subjective&nbsp;</span><i style="font-family: &quot;times new roman&quot;, serif;">distance&nbsp;</i><span style="font-family: &quot;times new roman&quot; , serif;">that exists between natural, character-driven, castes or&nbsp;</span><i style="font-family: &quot;times new roman&quot;, serif;">levels</i><span style="font-family: &quot;times new roman&quot; , serif;">&nbsp;of being human, all too human. We moderns hate to think of humanity in such terms, yet I wager we know it on an all-too-daily basis, as we inexorably interact with others—realizing that some people are naturally closer while insisting that others acknowledge the distance that is—and&nbsp;</span><i style="font-family: &quot;times new roman&quot;, serif;">must be</i><span style="font-family: &quot;times new roman&quot; , serif;">—there.</span></span><br /><span style="font-size: large;"><span style="font-family: &quot;times new roman&quot; , serif;">Even a mere essay reflects and reinforces the natural affinities and distances that account for there being&nbsp;</span><i style="font-family: &quot;times new roman&quot;, serif;">distinct&nbsp;</i><span style="font-family: &quot;times new roman&quot; , serif;">clusters, or castes, in any given human social context. Nietzsche wrote in his&nbsp;</span><i style="font-family: &quot;times new roman&quot;, serif;">Genealogy of Morals</i><span style="font-family: &quot;times new roman&quot; , serif;">&nbsp;that it is not meant to be understood by&nbsp;</span><i style="font-family: &quot;times new roman&quot;, serif;">everyone</i><span style="font-family: &quot;times new roman&quot; , serif;">. Breaching the natural distance as if it were somehow “immoral” could&nbsp;</span><i style="font-family: &quot;times new roman&quot;, serif;">sicken</i><span style="font-family: &quot;times new roman&quot; , serif;">, or infect, the innately stronger. Many of the self-certified “coaches” (i.e., “experts” on leadership), for example, have already dismissed this essay in its entirety, mistaking disdain for disagreement (and ultimately weakness for strength). Sustaining that distance is not only the odious smell of arrogant ignorance; the cockroaches themselves fear being “outed” as phonies by a pest-control guy whom they sense can spray them with the disinfectant of (other-certified) knowledge. The arrogance of cockroaches does not permit them to scatter in the transparency of knowledge, so they tend to naturally keep their distance in the first place.</span></span><br /><span style="font-family: &quot;times new roman&quot; , serif;"><span style="font-size: large;">Far more interesting than the presumption of false entitlement by supercilious “professionals” and the ignorant opinion certifying itself as knowledge by the “coaches” is the notion that differences in the duration and timing of genes that trigger other genes can (along with environmental factors) eventuate in human interaction manifesting as distinct clusters based on something as intangible as character—and much of it without intention! We naturally cohere with some people as though in invisible stickiness were involved, and we just as naturally keep our distance from others as if doing so were simply by instinct. I must admit I have tended not to pay sufficient attention to natural distance and have wound up having to enforce what should have been natural. As imperfect as nature’s caste system is, the historical Hindu attempt to systematize it by group and presumably for all ages to come shows just how far ahead nature is to human intention. Try as we might, we cannot bottle it! For unlike the Hindu variety, natural law does not depend on religious, political and economic institutions for enforcement.</span></span></div><br /><br /><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 10pt;"><span style="font-family: &quot;times new roman&quot; , &quot;serif&quot;; font-size: 12pt;">Sources:<o:p></o:p></span></div><span style="font-family: &quot;times new roman&quot; , &quot;serif&quot;; font-size: 12pt;">Lydia Polgreen, “<a href="http://www.nytimes.com/2011/12/22/world/asia/indias-boom-creates-openings-for%20untouchables.html?_r=1&amp;scp=1&amp;sq=Lydia%20Polgreen,%20%E2%80%9CScaling%20Caste%20Walls%20With%20Capitalism%E2%80%99s%20Ladders&amp;st=cse">Scaling Caste Walls With Capitalism’s Ladders</a>,”&nbsp;<i style="mso-bidi-font-style: normal;">The New York Times</i>, December 22, 2011.&nbsp;<o:p></o:p></span><br /><br /><div class="MsoNormal" style="margin: 0in 0in 10pt;"><span style="font-family: &quot;times new roman&quot; , &quot;serif&quot;; font-size: 12pt; line-height: 18.4px;">Friedrich Nietzsche,&nbsp;<i style="mso-bidi-font-style: normal;">Genealogy of Morals</i>, in&nbsp;<i style="mso-bidi-font-style: normal;">Basic Writings of Nietzsche</i>, Walter Kaufmann, trans. and ed. (New York: Modern Library, 2000).</span></div>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comtag:blogger.com,1999:blog-5896319920382721541.post-5211845681129478722017-08-08T18:51:00.001-07:002017-08-08T18:51:56.822-07:00Problems in American Executive Compensation: The Ethical Dimension<div style="text-align: justify;"><span style="font-size: large;">According to The New York Post,&nbsp;66% of the income growth in the United States between 2001 and 2007 went to the top 1% of all Americans. In 1950, the ratio of the average executive’s paycheck to the average worker’s paycheck was about 30 to 1. By the year 2000, that ratio&nbsp;had exploded to between 300 to 500 to one. Because American executives tend to be paid more in total compensation than do their European colleagues, the ratios are lower in in the E.U. Hence one might ask what is behind the trajectory in the United States.&nbsp;</span></div><div style="text-align: justify;"><span style="font-size: large;"><br /></span></div><div style="text-align: justify;"><span style="font-size: large;">Does a shift from manufacturing to knowledge-based industries occasion a widening economic gulf? Even as late as 2010, the United States still had the largest manufacturing sector in the world. I suspect that the change is not so much tied to the number or even proportion of factory workers as it is to changes in executive compensation. Specifically, in the 1990s stock options took off as a part of such compensation because boards wanted to tie executives' compensation to long term firm performance. Even if the alignment of incentives was strengthened, a side effect was an explosion in the overall level of a given executive's compensation. In other words, if an executive's company did well, so too did his or her total compensation package. This byproduct in turn raised the ethical issue of fairness.&nbsp; Specifically, is a CEO's work really worth tens of millions in a given year to a firm or to society at large?&nbsp; Is a CEO's effort really so much more than that of a mid-level manager or an employee in operations?&nbsp;&nbsp;</span></div><div style="text-align: justify;"><span style="font-size: large;"><br /></span></div><div style="text-align: justify;"><span style="font-size: large;">To obviate any ethical violations of fairness, which human beings seem able to detect innately, boards could reduce the overall compensation packages of executive managers even as the proportion in stock options is increased.&nbsp; Lest it be argued that the market demands the higher amounts, it could be argued that that market is an oligarchy rather than being competitive. If so, there might be a legitimate role for the U.S. Government as an umpire establishing and protecting competitive markets. Otherwise, an oligarchy can become a self-perpetuating club that functions primarily in the interest of its members, which occasions the ethical objection of fairness.</span></div><br />Source:<br /><br />"<a href="http://nypost.com/2010/08/01/so-long-middle-class/">So Long, Middle Class</a>,"&nbsp;<i>New York Post,&nbsp;</i>August 1, 2010.Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comtag:blogger.com,1999:blog-5896319920382721541.post-3412134352627183862017-08-08T18:31:00.001-07:002017-08-08T18:31:18.273-07:00Efficiency, Corporate Social Responsibility and Full Employment: Squaring a Circle<div class="MsoNoSpacing" style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">The New York Times reported that President Obama urged American businesses on February 7, 2011 to “'get in the game' by letting loose trillions of dollars being held in reserves, saying that they can help create a 'virtuous cycle' of more sales, higher demand and greater profits that will put people back to work and turn around the sluggish economy.” Obama continued, “If there is a reason you don’t believe that this is the time to get off the sidelines — to hire and invest — I want to know about it. I want to fix it.” In the speech at the U.S. Chamber of Commerce, Mr. Obama said that companies have a responsibility to help the economy recover. The trouble is that&nbsp;<i>responsibility</i>&nbsp;is a rather vague term that can be variously applied. This is one reason why the corporate social responsibility concept could mean providing society with the products and services that are sought via the marketplace (e.g. Milton Friedman of the Chicago school) while meaning for others increasing corporate philanthropy to alleviate a society problem such as poverty. In other words,&nbsp;<i>responsibility</i>&nbsp;can be made concrete in various ways that can accommodate and indeed reflect the ideologies of those applying the term.<o:p></o:p></span></div><div class="MsoNoSpacing" style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">It could be predicted, therefore, that the President's application of responsibility might have differed from some of the business managers in the audience. Indeed, Obama’s suggestion that businesses could help the economy recover by spending their reserves was met, according to&nbsp;<i>The New York Times</i>, “with skepticism by some in the audience.” For example, Harold Jackson, a executive at Buffalo Supply Incorporated (a medical supply company), called the President's suggestion naive. “Any business person has to look at the demand to their company for their product and services, and make hiring decisions,” Jackson said. “I think it’s a little outside the bounds to suggest that if we hire people we don’t need, there will be more demand.” In effect, Jackson was defending Friedman's application of corporate social responsibility from that of the President's.<o:p></o:p></span></div><div class="MsoNoSpacing" style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">To President Obama's assumption that American businesses were still sitting on the sidelines, it can be asked, in what sense? The President was pointing to what he viewed as excessive retained earnings. Yet John Schoen of MSNBC reported the same day that the American manufacturing sector was “roaring back” after the recession. Schoen reports a sustained&nbsp;rise in factory orders in five of the last six months, which prompted manufacturers to boost hiring. The Commerce Department had reported a few days before Schoen's report on February 7, 2011 that the manufacturing sector had added 49,000 new jobs in January. Yet this is hardly a roaring comeback in terms of new jobs. Schoen reports that businesses have figured out how to make more widgets with the same number of workers, resulting in higher productivity and profits. Investing reserves in automation, for example, raises productivity by making products faster and better. According to Schoen, “Productivity is a pretty simple concept: It’s a measure of how much stuff a worker makes in a given number of hours. . . . Productivity has also risen as American manufacturers have moved to specialize in more valuable products, sending manufacturing of cheaper goods overseas where wages are lower. As the value of American-made products has risen, so too has the average level of output per worker when measured in dollar terms.”&nbsp;Schoen reports that according to the U.S. Labor Department, the level of output per hour worked rose by 2.6 percent in the last three months of 2010. Even if it is not in the interest of labor, such improvement is in line with the logic of business, given how business is designed and how a competitive marketplace works. Spending retained earnings beyond that which can be expected to raise productivity simply does not make sense to a business practitioner.<o:p></o:p></span></div><div class="MsoNoSpacing" style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">In general terms, the (nearly) “jobless recovery” can be seen as pointing to a major difference between the interests of business and society—the latter being represented by the President at the Chamber of Commerce. Given the nature of business enterprise in a competitive market, it is only natural for managers (and boards) to work toward (and reward) greater efficiency (i.e. productivity). Business managers thus understand or apply&nbsp;<i>responsibility</i>&nbsp;in this way. As per Harold Jackson's point, to hire labor beyond the optimal efficiency point in order to solve the wider societal problem of unemployment would run against a firm's&nbsp;<i>telos,&nbsp;</i>or goal. Ultimately, such over-hiring would compromise a company's continued viability (which could result in the loss of even more jobs).<o:p></o:p></span></div><div class="MsoNoSpacing" style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">One cannot blame a manager for thinking in line with his or her company's logic, or&nbsp;<i>raison d'etre,</i>&nbsp;any more than one can blame a shark for hunting for food and eating like a shark. A shark is a shark, and a business can also be viewed as a feeding machine. To posit or impose responsibilities onto a machine does not make sense either to the machine or to those who operate it (in their functioning as operators). To an operator,&nbsp;<i>responsibility</i>&nbsp;means operating&nbsp;<i>well</i>—which, by the way, is virtue in the ancient Greek sense. The President's use of responsibility&nbsp;<i>extrinsic</i>&nbsp;to a business calculus simply would not register. It would be like trying to get&nbsp;<i>ought</i>&nbsp;out of&nbsp;<i>is</i>. Even within business functionality, responsibility even as in fiduciary duty to the stockholders is simply translated into “try to get as much profit as possible, now or later.” In other words,&nbsp;<i>ought</i>&nbsp;does not compute in a business technical vocabulary. The term is extrinsic, like societal problems and goals. To come from a societal standpoint and impose “be responsible” to a business practitioner is like shouting at a deaf person. The business person is apt to simply look curiously at the person as if wondering why he is speaking in a foreign language while assuming he is being understood nevertheless. “How&nbsp;<i>odd</i>,” is perhaps the most honest response that one could give to such a display.<o:p></o:p></span></div><div class="MsoNoSpacing" style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">The difference between the President's application of responsibility and that of Jackson can also be understood as the difference between the interest of a subunit and the system as a whole. It is only natural for a part of a whole to operate in the interest of the part itself rather than necessarily the whole. The interests of the latter can thus fall through the cracks. Government regulation is an attempt to plug such cracks, but regulations, like firms, are particular. On the issue of unemployment, the societal question is whether even a fully-operational economic system can supply full employment. If not, it may be the government's&nbsp;<i>responsibility</i>&nbsp;to supply the surplus employment, directly or indirectly via subcontracting. Crucially, this supply must be designed such that it does not reduce the employment provided by the private sector. The surplus jobs must be functions that the private sector does not and would not address. The President's error in his speech to the Chamber of Commerce could be that he was assuming this surplus is the responsibilities of “parts” of the system (i.e. individual companies) rather than of the system itself (i.e. the government).<o:p></o:p></span></div><div class="MsoNoSpacing" style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">In sum,&nbsp;<i>responsibility</i>&nbsp;is a dubious concept to apply to business; the term is too vague to have much traction in discussing such vital matters as affect our economic livelihoods and the related viability of our economy. It seems to me that the priority ought to be that every able-bodied and minded adult has a job (or, otherwise, a means by which he or she can have sufficient economic wherewithal to survive in this interdependent society), whether through business, non-profits or government. Ideologies, including r<em>esponsibility</em>&nbsp;itself, ought to be relegated as luxuries with which we can play on the margins once full employment has become a&nbsp;<em>fait accompli</em>. That is to say, ideologies might contribute to improving full employment, rather than being depended on to reach it or allowed to keep us from it. Of course, it could be countered that ideologies are part and parcel of this entire discussion and thus cannot be dissected from it. That may well be. Even so, I submit that ideologies such as&nbsp;<i>laissez faire</i>&nbsp;and corporate social responsibility ought not be allowed to thwart us in how we constitute full employment as a societal fact. That is to say, we ought to direct full employment by whatever means&nbsp;<em>necessary</em>&nbsp;then work from there (once attained) to improve it. Simply put, for some reason, we don't treat full employment as&nbsp;<em>necessary</em>.; rather, we treat it as a goal.&nbsp; "How&nbsp;<em>odd</em>," an alien from another galaxy might say (in its own language, of course), should one visit us and want to study us.</span><o:p></o:p></div><div style="margin-bottom: .0001pt; margin: 0in; text-align: justify;"><br /></div><div style="margin-bottom: .0001pt; margin: 0in; text-align: justify;">Sources:<o:p></o:p></div><div style="margin-bottom: .0001pt; margin: 0in; text-align: justify;"><br /></div><div style="margin-bottom: .0001pt; margin: 0in; text-align: justify;">Michael D. Shear, “<a href="http://thecaucus.blogs.nytimes.com/2011/02/07/in-speech-to-chamber-obama-urges-business-to-get-in-the-game/?ref=politics">In Speech to Chamber of Commerce, Obama Urges Businesses to ‘Get in the Game,’</a>” <i>The New York Times</i>, February 7, 2011.<o:p></o:p></div><div style="margin-bottom: .0001pt; margin: 0in; text-align: justify;"><br /></div><br /><div style="margin-bottom: .0001pt; margin: 0in; text-align: justify;">John W. Schoen, “<a href="http://www.msnbc.msn.com/id/41415001/ns/business-stocks_and_economy/">Factories Boom, but with Few New Workers</a>,” February 7, 2011, NBCNews.com.<o:p></o:p></div>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comtag:blogger.com,1999:blog-5896319920382721541.post-56033279263603073352017-08-08T10:48:00.001-07:002017-08-08T10:52:08.404-07:00Does Opportunity Justify Economic Inequality?<div style="text-align: justify;"><span style="font-family: &quot;times new roman&quot; , &quot;serif&quot;; font-size: large;">From 1993 to 2010, the incomes of the richest 1 percent of Americans grew 58 percent while the rest had a 6.4 percent increase.&nbsp;<span style="mso-spacerun: yes;">&nbsp;</span>In 2010, the first year of an economic recovery, the top 1 percent of Americans captured 93% of the income gains. Beyond the danger to the American republics in there being an economic elite so far removed from the vast majority of the population is the question of whether the trend is baleful, economically speaking. It is not clear that even such an income gain being snagged by so few registered in the minds of the general populous as a problem. The key to any concern would seem to be whether opportunity for the many is compromised as a result of extreme economic inequality.</span></div><div style="text-align: justify;"><span style="font-size: large;"><br /></span></div><div style="text-align: justify;"><span style="font-size: large;"><span style="font-family: &quot;times new roman&quot; , &quot;serif&quot;;"></span><span style="font-family: &quot;times new roman&quot; , &quot;serif&quot;;">In 2011, inequality was not exactly the top priority of American voters: only 17 percent thought it is extremely important for the government to try to reduce income and wealth inequality, according to a Gallup survey. That is about half the percent who said reigniting economic growth was crucial. However, 29 percent said it was extremely important for the government to increase equality of opportunity. More significant, 41 percent said that there was not much opportunity in America, up from 17 percent in 1998. The question is whether the concurrent increase in economic inequality was viewed as&nbsp;<i style="mso-bidi-font-style: normal;">causing&nbsp;</i>the decrease in opportunity. According to David Hume’s naturalist fallacy, a correlation does not itself mean a causal relationship exists. The fact that economic inequality was increasing as opportunity was decreasing does not&nbsp;<i style="mso-bidi-font-style: normal;">in itself&nbsp;</i>mean that the increasing inequality was reducing opportunity. There might be a causal relationship, but more is needed to support it than a correlation.</span></span></div><div style="text-align: justify;"><span style="font-size: large;"><br /></span></div><div style="text-align: justify;"><span style="font-size: large;"><span style="font-family: &quot;times new roman&quot; , &quot;serif&quot;;"></span><span style="font-family: &quot;times new roman&quot; , &quot;serif&quot;;">According to the New York Times, comparisons across countries “suggest a fairly strong, negative link between the level of inequality and the odds of advancement across the generations. The link makes sense: a big income gap is likely to open up other social breaches that make it tougher for those lower down the rungs to get ahead. And that is exactly what appears to be happening in the United States, where a narrow elite is peeling off from the rest of society by a chasm of wealth, power and experience.” Additionally, that elite can use its wealth as power to reserve the opportunities itself. For instance, donations to universities (and lobbying government officials) could be used to keep financial-aid-based admissions down to a certain level such that there are plenty of spots available for children of the well-off. Appeals seemingly in the interest of the masses can even be utilized, as in wanting to reduce subsidized student loan programs because students are suffering from too much debt.</span></span></div><div style="text-align: justify;"><span style="font-size: large;"><br /></span></div><div style="text-align: justify;"><span style="font-size: large;"><span style="font-family: &quot;times new roman&quot; , &quot;serif&quot;;"></span><span style="font-family: &quot;times new roman&quot; , &quot;serif&quot;;">In my view, the business-government dynamic is crucial to why increasing economic inequality is harmful both politically and economically. Minimizing the harm to reduced opportunity ignores the injustice that comes with the inequality itself. Wealth can easily be made into power, which in turn can be used in political, economic and societal realms in self-serving ways. The primacy of opportunity assumes that anyone can be rich if he or she just works hard enough. Both on account of the way the system is designed and the differences between people, not everyone will succeed even if given the opportunity.</span></span></div><div style="text-align: justify;"><span style="font-size: large;"><br /></span></div><div style="text-align: justify;"><span style="font-size: large;"><span style="font-family: &quot;times new roman&quot; , &quot;serif&quot;;"></span><span style="font-family: &quot;times new roman&quot; , &quot;serif&quot;;">Furthermore, conditioning one’s objection to economic inequality in society on whether one’s opportunity is affected can be viewed as self-centered as well as rather narrow because one is indifferent to the negative effects of the inequality on others apart from any decreased opportunity as long as one believes that one’s own opportunity is not adversely affected. Put another way, too many Americans are willing to look the other way on how the elite can unfairly use their advantage aside from restricting opportunity. The right of the elite to so much wealth is tacitly acknowledged as long as opportunity is still thought to exist.<span style="mso-spacerun: yes;">&nbsp;&nbsp;</span>As long as it does, society has no right to take from the rich even if they compromise the republics themselves. This is a very minimalist notion of social contract—one that the 1% benefit from. This is hardly an accident—political ideology established in society being in the interest of the relatively few beneficiaries of the vast majority of income gain.</span></span></div><div style="text-align: justify;"><span style="font-size: large;"><br /></span></div><div style="text-align: justify;"><span style="font-family: &quot;times new roman&quot; , &quot;serif&quot;; font-size: large;"></span><span style="font-family: &quot;times new roman&quot; , &quot;serif&quot;; font-size: 12pt;"><span style="font-size: large;">Therefore, whether increasing economic inequality&nbsp;<i style="mso-bidi-font-style: normal;">causes&nbsp;</i>less opportunity for the masses is a question that can be relegated to the more important question of whether the inequality itself is inherently unfair and/or a threat to the republics, the economy, and even society. How the wealth has been and is gained as well as used are relevant to the ethical question of fairness, and thus to whether the concentration of wealth is&nbsp;<i style="mso-bidi-font-style: normal;">legitimate</i>. Crucially, a focus on opportunity misses this point. Besides its ethical dimension, absolute or relative economic inequality could be harmful in building up pressure of resentment and even revolution, as evinced in the Occupy Wall Street Movement (which has been safely marginalized—with its own complicity). As the interests of the elite and the masses diverge and the elite (e.g., Goldman Sachs) gains more and more power, the strangling of the lower and lower-middle classes may ensue—a development that could not be good for a society’s stability. A focus on opportunity recalibrated in terms of being promoted to manage a McDonalds’ restaurant misses this point. In short, we are missing the iceberg coming up in front of our ship because we are satisfied if we can still get a deck chair.</span><span style="font-size: 12pt;"><o:p></o:p></span></span></div><br /><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 10pt; tab-stops: 135.0pt; text-align: justify;"><span style="font-family: &quot;times new roman&quot; , &quot;serif&quot;; font-size: 12pt;">Source:<o:p></o:p></span></div><span style="font-family: &quot;times new roman&quot; , &quot;serif&quot;; font-size: 12pt;">Eduardo Porter, “<a href="http://www.nytimes.com/2012/03/21/business/economy/tolerance-for-income-gap-may-be-ebbing-economic-scene.html">Inequality Undermines Democracy</a>,”&nbsp;<i style="mso-bidi-font-style: normal;">The New York Times</i>, March 21, 2012.&nbsp;</span>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comtag:blogger.com,1999:blog-5896319920382721541.post-43872909493943759142017-08-08T10:28:00.001-07:002017-08-08T11:02:02.996-07:00Christianity and “Social Capitalism”<div style="font-family: Times,&quot;Times New Roman&quot;,serif;"><div style="text-align: justify;"><span style="font-size: large;">The SEC charged Ephren Taylor with a fraudulent $11 million Ponzi scheme in April 2012. According to Reuters, “</span><span lang="EN" style="font-size: large;">Taylor fraudulently sold $7 million of notes said to bear 12 percent to 20 percent annual interest rates, to fund small businesses such as laundries, juice bars and gas stations.” He “had conducted a multi-city ‘Building Wealth Tour’ in which he spoke to congregations” on the importance of “giving back.” He called himself a “social capitalist.” In actuality, he used the money on himself and his wife’s attempt to become a singer.</span></div></div><div style="font-family: Times,&quot;Times New Roman&quot;,serif;"><div style="text-align: justify;"><span style="font-size: large;"><br /></span></div></div><div style="font-family: Times,&quot;Times New Roman&quot;,serif;"><div style="text-align: justify;"><span lang="EN" style="font-size: large;">The congregants’ susceptibility to Taylor can be understand from grasping&nbsp;<a href="http://thewordenreport.blogspot.com/2012/01/preface-to-godliness-greed.html">the larger historical trend within Christianity</a>&nbsp;wherein the prosperity gospel—in which it is believed that God rewards “true believers” with material wealth—had replaced the anti-wealth view wherein being rich&nbsp;<i>and&nbsp;</i>saved is like a camel getting through the eye of a needle. In other words, the shift in historical Christian thought from a close coupling of wealth and greed to an outright rejection of such a linkage made it more likely that the lay Christians would view investing in “social capitalism” as sufficient to justify having wealth beyond subsistence living.</span></div></div><div style="font-family: Times,&quot;Times New Roman&quot;,serif;"><div style="text-align: justify;"><span style="font-size: large;"><br /></span></div></div><div style="font-family: Times,&quot;Times New Roman&quot;,serif;"><div style="text-align: justify;"><span lang="EN" style="font-size: large;">Secondly, Taylor’s assumed conflation or mixing of Christianity and social performance in business enabled the congregants to open their wallets presumably for religious purposes in line with a social conscience. It is worth pointing out that camel is not given a pass for using wealth in a socially responsible manner. In other words, if simply having wealth is indicative of underlying greed, how one uses the wealth is not sufficient to undo the linkage and justify having the wealth in the first place.</span></div></div><div style="font-family: Times,&quot;Times New Roman&quot;,serif;"><div style="text-align: justify;"><span style="font-size: large;"><br /></span></div></div><div style="font-family: Times,&quot;Times New Roman&quot;,serif;"><div style="text-align: justify;"><span lang="EN" style="font-size: large;">Moreover, fidelity to a social norm such as corporate social responsibility is not&nbsp;<i>religious</i>. Even though Unitarians maintain that certain social structures are the object of their faith, the religious domain contains a transcendent referent.&nbsp; That is, faith in a religious sense is oriented to an object that lies beyond the limits of human cognition and perception.&nbsp; Specific social structures do not qualify because they are in our human domain.</span></div></div><div style="font-family: Times,&quot;Times New Roman&quot;,serif;"><div style="text-align: justify;"><span style="font-size: large;"><br /></span></div></div><div style="font-family: Times,&quot;Times New Roman&quot;,serif;"><div style="text-align: justify;"><span lang="EN" style="font-size: large;">In fact, to advocate a particular social norm is not to justify ethically with ethical reasons.&nbsp; That is to say, corporate social responsibility is not business ethics.&nbsp; The difference can be explained by referring to David Hume’s naturalist fallacy, which holds that what “is” the case cannot justify what “should” be. In other words, you can’t get&nbsp;<i>ought&nbsp;</i>out of a melon. You need ethical reasons, such as “it is fair because x,” to justify what one&nbsp;<i>should&nbsp;</i>do. To advocate a social norm is not to provide an ethical reason; more would be needed to provide support for why a certain norm that can exist&nbsp;<i>should&nbsp;</i>exist.</span></div></div><div style="font-family: Times,&quot;Times New Roman&quot;,serif;"><div style="text-align: justify;"><span style="font-size: large;"><br /></span></div></div><div style="font-family: Times,&quot;Times New Roman&quot;,serif;"><div style="text-align: justify;"><span lang="EN" style="font-size: large;"></span><span lang="EN" style="font-size: large;">Therefore, I question Taylor’s linking “social capitalism” to religion (and Christianity in particular). The application cannot even be justified under the rubric of religious ethics. In addition, the congregants were too gullible because they had applied or bent Christianity too far from its native turf.<o:p></o:p></span></div></div><span style="font-size: large;"><br /></span><span style="font-size: large;">See:&nbsp;<a href="https://www.amazon.com/s/ref=nb_sb_noss?url=search-alias%3Dstripbooks&amp;field-keywords=skip+worden+god%27s+gold"><i>God's Gold</i></a>, available in print and as an ebook at Amazon.</span><br /><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 10pt; tab-stops: 135.0pt; text-align: justify;"><br /><span lang="EN" style="font-family: &quot;times new roman&quot; , &quot;serif&quot;; font-size: 12pt;">Source:<o:p></o:p></span></div><span lang="EN" style="font-family: &quot;times new roman&quot; , &quot;serif&quot;; font-size: 12pt;">Jonathan Stempel, “<a href="http://www.huffingtonpost.com/2012/04/12/sec-ephren-taylor-ii_n_1421970.html?ref=business">SEC Charges Ephren Taylor II ForAllegedly Bilking Churchgoers In $11 Million Ponzi Scheme</a>,” The Huffington Post, April 12, 2012.</span><br /><div style="-webkit-text-stroke-width: 0px; color: black; font-family: &quot;Times New Roman&quot;; font-size: medium; font-style: normal; font-variant-caps: normal; font-variant-ligatures: normal; font-weight: normal; letter-spacing: normal; margin: 0px; orphans: 2; text-align: start; text-decoration-color: initial; text-decoration-style: initial; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px;"><br /></div>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comtag:blogger.com,1999:blog-5896319920382721541.post-62779839331247055232017-08-05T15:34:00.000-07:002017-08-05T15:38:51.982-07:00A Professional Misnomer: Everyone Is a Self-Proclaimed Professional!<div class="MsoNormal" style="margin: 0in 0in 0pt;"><div class="MsoNoSpacing" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Certainly by the turn of (and well into) the twenty-first century, the term, "professional" had become such a cherished word in the American lexicon that every American had decided that he or she is one. Evincing the Lake Wobegon effect—the tendency of most people to describe themselves or their abilities as above average—nearly everyone is wont to say, “I am a professional.” On housing listings on Craigslist, for example, people routinely use the word to signify that they are not students. In fact, even some students characterize themselves as professionals (though not as professional students!). Such&nbsp;<i style="mso-bidi-font-style: normal;">common</i>&nbsp;usage belies the term's claim to having a specific meaning. Moreover, the tendency of non-professions to deem themselves as professions nonetheless may evince one of the downsides of democracy—namely, its proclivity to excess in terms of self-entitlement. This is particularly likely to ensue from a citizenry that is lacking in self-discipline, virtue and knowledge.&nbsp;<o:p></o:p></span></div><div class="MsoNoSpacing" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">I contend that the self-appellation of “professional” is in actuality an attempt at inclusion in what was hitherto known as “the professional class.” Nietzsche’s thesis is relevant regarding the instinct of certain herd animals to dominate as if they were strong—even though they are in fact weak.&nbsp;<o:p></o:p></span></div><div class="MsoNoSpacing" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">It is as though a manager at Walmart imagines a concept of egalitarianism wherein he is akin to a lawyer or surgeon—perhaps based on the fact that the manager distinguishes himself somehow from his subordinate “employees.”&nbsp;&nbsp;Even in the midst of such self-vaunting, a knowledge of store policies and years of practice in dealing with customer complaints do not constitute an equivalent to the knowledge of law or medicine required of a lawyer and physician, respectively. Nor is there an obligation to the public such as in entailed in the practice of law or medicine.<o:p></o:p></span></div><div class="MsoNoSpacing" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Technically, the term "professional" applies to “the professions.”&nbsp;&nbsp;This does not mean “any profession” in the sense of “any job category.” Because a professional relies on years of study, albeit undergraduate (meaning only one degree in a discipline/school of knowledge), in his or her&nbsp;<i style="mso-bidi-font-style: normal;">practice</i>, he or she must be allowed significant autonomy. Hence the partnership arrangement, wherein the self-discipline of peerage rather than a boss is relied on, is the typical business form for law firms, CPA firms, and medical offices. Managers in business are not professionals. This can be seen both from the standpoint of the relative salience of a responsibility to the client/customer and of judgment.<o:p></o:p></span></div><div class="MsoNoSpacing" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">According to Relson (p. 750),&nbsp;“the basic social role of the physician . . . is to be an agent and trustee for the patient. Physicians are ethically bound to place the medical care needs of their patients before their own financial interests – an obligation that clearly sets the practice of medicine apart from business.” One could add a lawyer's ethical obligation to act in the interest of the client and the CPA's obligation to act in the interest of the public (people who rely on the financial statements). In business by contrast, "buyer beware" is often the default; a business practioner serves a customer for monetary gain.<o:p></o:p></span></div><div class="MsoNoSpacing" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Similarly, the judgment of a lawyer, physician or CPA is not easily second-guessed by people outside of the respective profession. Even in a hospital, a physician is not reviewed by a manager who is not also a physician.&nbsp;In contrast, non-managerial board directors commonly review the performance of managers.<o:p></o:p></span></div><div class="MsoNoSpacing" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Put another way, whereas one can manage a business without having attended business school, I do not think any of us would agree to be seen by a physician who had not graduated from a medical school. Nor would a defendant in a criminal case be likely to chance a conviction (and decades in prison) by hiring a lawyer who had not studied law. Creditors and investors would think twice about the unqualified opinion of a CPA firm whose auditors had not passed the CPA exam after years of study of accounting.&nbsp;&nbsp;That a certified public accountant might also engage in consulting, however, does not mean that consultants are thereby also professionals. Even were consultants to devise a certifying exam, it would not be as substantive or relied on as the lawyer bar exam, medical boards, and the CPA exam.<o:p></o:p></span></div><div class="MsoNoSpacing" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">According to John Boatright (2008), the "work of most financial services providers does not meet the standard criteria for a profession. Among the criteria for a profession which are lacking in financial services are a high degree of organization and self-regulation, a code of ethics, and a commitment to public service. These criteria are possibly met by financial planners and insurance underwriters, but not by brokers, bankers, traders . . ., who, in the strict sense of the term, are not professionals." Financial planners and insurance underwriters come up short, however, in terms of educational requirements.&nbsp;<o:p></o:p></span></div><div class="MsoNoSpacing" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">According to Boatright (1992), a professional’s stock in trade is a body of specialized knowledge that is the basis for making judgments. Not only is the reliance placed on a professional’s judgment relatively important; professionals are paid primarily for the value of their knowledge that is the basis for their judgments. Accordingly, it is difficult, if not impossible, anyone other than their peers to evaluate their practice.&nbsp;&nbsp;In fact, Jean Van Houtte (p. 207) refers to professionals as “individuals who practice their occupation autonomously.” Even another surgeon is limited in being able to second-guess a colleague without being in the operating room at the time. The salient element of judgment includes discretion that is difficult for even colleagues to evaluate (though not impossible); obvious lapses, for example, can easily be discerned by a professional’s peers.&nbsp;<o:p></o:p></span></div><div class="MsoNoSpacing" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">In short, the term "professional" has a specific and limited meaning centered on the responsibility-autonomy that is entailed when specialized-knowledge-informed-judgment is salient in the practice of an occupation. The term does not apply to anyone who does something for a living (as opposed to being an avocation).&nbsp;&nbsp;If it did, then even prostitutes and politicians would be professionals.&nbsp;&nbsp;The term “professional politician” connotes ignorance, for which political office is not a job?&nbsp;&nbsp;It is not like one can be governor of Alaska as a hobby. Also, neither "mature" nor "responsible” is interchangeable with “professional.” Nor does the term mean “acting impersonally or bureaucratically rather than emotionally.” It is no accident that people not in one of the professions use notably wide criteria.</span></div><div class="MsoNoSpacing" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Until the last few decades of the twentieth century, the term "professional" did not suffer from such lack of clarity. For example, Joe Flom, who was instrumental as a lawyer in the hostle take-over bubble that began in the 1970s, claimed that his parents wanted him to be a "professional." He wrote that for them, "being a professional was a great thing. . . . That meant either a doctor or a lawyer." This was the popular application: medicine or law--not a manager or sales person, or even a CEO. Then a sort of inflation set in, and the value associated with being a “professional” has diminished in proportion. The presumption that simply getting hired or being mature on the job makes a person a professional is odious and false. In fact, the over-reach itself evinces an underlying sordid character. Ironically, such a person is in need of more supervision, rather than warranting any sort of autonomy.&nbsp;</span><o:p></o:p></div><span style="color: black; font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><span style="color: black;"></span></span><br /><div style="text-align: justify;"><span style="color: black; font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><span style="color: black;"><span style="color: black;"><span style="color: black;"><br /></span></span></span></span></div><span style="color: black; font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><span style="color: black;"></span></span></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><span style="color: black;">Sources:</span></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><br /><span style="color: black;">Jeff Madrick,&nbsp;<em>Age of Greed: The Triumph of Finance and the Decline of America, 1970 to the Present</em>&nbsp;(New York: Alfred A. Knoff, 2011).</span><br /><br /><span style="color: black;">John R. Boatright, “Conflict of Interest: An Agency Analysis.” Pp. 187-203 in&nbsp;<i style="mso-bidi-font-style: normal;">Ethics and</i></span><i style="mso-bidi-font-style: normal;"><span style="mso-tab-count: 1;">&nbsp;</span>Agency Theory: An Introduction</i><span style="color: black;">, Norman E. Bowie and R. Edward Freeman, eds.</span><span style="color: black;"><span style="mso-tab-count: 1;">&nbsp;</span>(Oxford: Oxford University Press, 1992).</span><br /><br /><span style="color: black;">John R. Boatright,&nbsp;<i style="mso-bidi-font-style: normal;">Ethics in Finance</i>&nbsp;(Oxford: Blackwell, 2008).</span><br /><br />Arnold S. Relman, “Dealing with Conflicts of Interest,”&nbsp;<i>New England Journal of Medicine</i>&nbsp;313 (1985): 749-51.<br /><br /><span style="color: black;">Jean Van Houtte, “Research Report: Conflicts of Interest in Law Firms in Belgium,”&nbsp;<i style="mso-bidi-font-style: normal;">Legal Ethics</i>&nbsp;12 (part II): 207-28.</span><br /><span style="color: black;"><br /></span><span style="color: black;">See also:</span><br /><span style="color: black;"><br /></span><span style="color: black;">Skip Worden, <i><a href="https://www.amazon.com/s/ref=nb_sb_noss?url=search-alias%3Daps&amp;field-keywords=skip+worden+on+the+arrogance+of">On the Arrogance of False Entitlement: A Nietzschean Critique of Business Ethics and Management</a></i>.</span></div>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comtag:blogger.com,1999:blog-5896319920382721541.post-12414524147722513062017-08-05T15:21:00.003-07:002017-08-06T16:59:36.080-07:00A Managerial Society of Carrots and Sticks<div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="color: black; font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">In a society of managerialism, a particular value-set is salient; it can be characterized overtly or tacitly by&nbsp;<i style="mso-bidi-font-style: normal;">technique</i>&nbsp;as a functional means of manipulating resources (human or material). This orientation issues in an instrumentalism wherein even other human beings are viewed as means rather than as ends in themselves. Furthermore, an assumption of incrementalism rather than real change tends to accompany the orientation because the status quo is the default where the focus is on instruments. The managerial orientation can be so ingrained in generally accepted “organization speak” that the modern herd hardly recognizes the penetration in modern society itself.</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="color: black; font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">In the film,&nbsp;<i style="mso-bidi-font-style: normal;">The Matrix</i>, Neo is eventually able to see the matrix for what it is: series of green ones and zeros scrolling up or down.<span style="mso-spacerun: yes;">&nbsp;&nbsp;</span>It is only then that he has power to punch through it with complete impunity.<span style="mso-spacerun: yes;">&nbsp;&nbsp;</span>Likewise, it is only when a person sees the allurements and arrows in a company’s customer service that a customer can transcend the vacuous business-speak and thus be able to resist the attempted manipulation.<span style="mso-spacerun: yes;">&nbsp;&nbsp;</span>Rational nature, according to Kant, views itself as an end in itself. Therefore, a natural tension exists between a manipulator and the object, which views itself as an end rather than a means to another’s end. Coming to perceive the attempted manipulation naturally triggers resentment, for it is presumptuous to&nbsp;<i style="mso-bidi-font-style: normal;">use&nbsp;</i>another person without any recognition of the other’s inherent nature that intrinsically resists being used.<span style="mso-spacerun: yes;">&nbsp;</span></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="color: black; font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">For example, an employee representing an organization typically presumes that the potential customer is already under the organization’s policies and procedures.<span style="mso-spacerun: yes;">&nbsp;&nbsp;</span>It is hardly imaginable that a potential customer would use phrases such as “you have to” before any transaction has been agreed to. Furthermore, employees who refuse to deign themselves to negotiate with potential customers presume that the default lies on their side; organizational “policy” or rigidity is merely back up to the operative point that negotiating would be humiliating in that the being of the potential customer would have to be recognized at least in part as an end in itself of equal value to the employee’s company of rational natures.</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="color: black; font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">In other words, modern society, at least in the West, has come to accept the presumptuousness that has come to characterize the attitude of employees who view their role as holding policy up to customers&nbsp;<i style="mso-bidi-font-style: normal;">who must either accept it or go away</i>. Policy serves here as a&nbsp;<i style="mso-bidi-font-style: normal;">technique&nbsp;</i>by which to dominate. It is used because the organizational herd animal wants to dominate but knows that it is too weak to do so without the aid of&nbsp;<i style="mso-bidi-font-style: normal;">policy taken as law</i>. Rather than negotiating with customers, they are told “<i style="mso-bidi-font-style: normal;">you must</i>” or “<i style="mso-bidi-font-style: normal;">you can’t</i>” even before they agree to a transaction.</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="color: black; font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Policy is used as a stick instrument. Managerialism also makes use of carrots, or inducements. “You don’t like the product you have purchased?<span style="mso-spacerun: yes;">&nbsp;&nbsp;</span>You can’t return it (policy as domination) but here is a coupon for 10% off your&nbsp;<i style="mso-bidi-font-style: normal;">next&nbsp;</i>purchase.” For the other end of a conversation to consist of&nbsp;<i style="mso-bidi-font-style: normal;">only&nbsp;</i>carrots and sticks is naturally to be disconcerting, even maddening because the subtext is a refusal to recognize&nbsp;<i style="mso-bidi-font-style: normal;">the other&nbsp;</i>as an end in itself. In fact, there is evidence that the carrots and sticks of managerialism have a rather narrow application with human beings. Therefore, much of the effort by people in organizations to induce or threaten may be in vain.<span style="mso-spacerun: yes;">&nbsp;</span></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="color: black; font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">According to CNN, “In laboratory experiments and field studies, a band of psychologists, sociologists and economists have found that many carrot-and-stick motivators — the elements around which we build most of our businesses and many of our schools — can be effective, but that they work in only a surprisingly narrow band of circumstances. For enduring motivation, the science shows, a different approach is more effective. This approach draws not on our biological drive or our reward-and-punishment drive, but on what we might think of as our third drive: Our innate need to direct our own lives, to learn and create new things, and to do better by ourselves and our world. In particular, high performance — especially for the complex, conceptual tasks we’re increasingly doing on the job— depends far more on intrinsic motivators than on extrinsic ones.” This third drive is that which stems from our rational nature viewing itself as an end in itself (i.e., having absolute value, because rational nature&nbsp;<i style="mso-bidi-font-style: normal;">assigns&nbsp;</i>value to things).</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="color: black; font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">So organizational employees and their task-masters may well be selling their fellow human beings short in presuming that they must be buffeted with inducements and threats from the get-go.<span style="mso-spacerun: yes;">&nbsp;&nbsp;</span>Perhaps these organizational creatures are of the lower sort that function only by being manipulated and threatened.<span style="mso-spacerun: yes;">&nbsp;&nbsp;</span>Perhaps they project their own self-centeredness out onto ordinary, free, human beings.</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="color: black; font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">The third drive can lead a potential or actual customer to say, “I am not in your organization so I am not subject to it as you are,” or even more directly, “I do not appreciate being manipulated” or “I feel insulted by being pressured to buy something else as I’m leaving your store after buying one of your products.”<span style="mso-spacerun: yes;">&nbsp;&nbsp;</span>Typically, the employee will feign ignorance of what he or she has been doing, or simply ignore the demurs of the dissatisfied customer. We moderns are bombarded every day with organizational passive-aggression via “organization-speak” consisting of carrots and sticks. We are so used to it in our organizational society that we absorb it without realizing what it is and&nbsp;<i style="mso-bidi-font-style: normal;">how it affects us as human beings</i>.</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><br /></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><br /></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><span style="color: black;">Source:</span></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><br /></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><span style="color: black;">Daniel H. Pink, “<a href="http://www.cnn.com/2010/OPINION/03/02/pink.motivation.bonuses/index.html?dsq=38857033#comment-38857033"><span style="color: blue;">Big Bonuses Don’t Mean Big Results</span></a>,” CNN, March 2, 2010.</span><br /><span style="color: black;"><br /></span><span style="color: black;">See a related book, available at Amazon: <i><a href="https://www.amazon.com/s/ref=nb_sb_noss?url=search-alias%3Daps&amp;field-keywords=skip+worden+on+the+arrogance+of">On the Arrogance of False Entitlement</a></i></span></div>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comtag:blogger.com,1999:blog-5896319920382721541.post-66012202474235317032017-08-05T14:54:00.004-07:002017-08-05T14:54:50.036-07:00The Aristocracy of the Moneyed Corporations<div style="text-align: center;"><span style="font-size: large;">“I hope we shall crush in its birth the aristocracy of our moneyed corporations.” &nbsp;</span><span style="font-size: large;">Thomas Jefferson</span></div><div style="text-align: center;"><span style="font-size: large;"><br /></span></div><div style="text-align: justify;"><span style="font-size: large;">In&nbsp;<em>Citizens United v. FEC&nbsp;</em>on January 21, 2010, the US Supreme Court held by 5 to 4 that because US corporations are legal persons, they can contribute to political campaigns.&nbsp;&nbsp; The assumption here is that corporations are more than the sum of an aggregate of persons—that is, more than citizens associating.&nbsp; The corporate entity has rights in itself.&nbsp; Ginsberg and Sotomeyer questioned in oral arguments whether free speech applies to spending money, and, moreover, whether corporations should be considered legal persons, much less citizens.&nbsp; After all, they can’t be drafted, or vote.</span></div><div style="text-align: justify;"><span style="font-size: large;"><br /></span></div><div style="text-align: justify;"><span style="font-size: large;">A corporate is essentially privately owned wealth.&nbsp; To say that wealth counts as speech seems spurious to me.&nbsp; In fact, the whole legal person designation seems contrived.&nbsp; Whereas the Roman republic fell to dictatorship, our republic may well have already fallen to oligarchy or corporatism.&nbsp;&nbsp; So I agree with Barak Obama that the decision is worrisome.&nbsp;&nbsp; Already, Dick Durbin of the US Senate said that the banking lobby owns Congress after that lobby sank Durbin’s amendment to allow bankrupcy judges to modify mortgages in foreclosure (the banks want a veto, even if they contributed to the sub-prime mess).&nbsp; If Goldman Sachs can spend virtually unlimited amounts of money on political campaigns, we can expect to see that bank’s influence over the government expand even beyond what influence it has over its own alums who occupy high policy-making positions in the US Government (e.g., Hank Paulson and Neil Kashkari at Treasury under Bush II).&nbsp; If our republic is already compromised under the weight of huge concentrations of private capital, the US Supreme Court’s decision may well be enough to sink the republic…ironically in the name of liberty.&nbsp; But liberty for whom?&nbsp; Or does “whom” even apply here…&nbsp; It seems to me that corporations are not citizens associating for political purposes.&nbsp; There are indeed non-profit political organizations whose function it is to influence policy.&nbsp; This is not a business corporation’s function.&nbsp; Nor is spending money itself political speech.&nbsp; Any CEO can stand outside his or her building and give a political speech for free.&nbsp; But which citizens does the CEO represent in his or her association of citizens?&nbsp; Stockholders?&nbsp; They don’t approve corporate public affairs spending.&nbsp; Employees?&nbsp; They don’t either.&nbsp; Customers?&nbsp;&nbsp; We don’t approve what a CEO says just because we have purchased a bar of soap.&nbsp; The US Supreme Court’s majority might well say that the CEO represents the legal person that is the corporation, but then it is not an association of citizens because associations are not said to be persons (rather, they consist of persons).&nbsp; Is this too logical?&nbsp; Too reasoned?&nbsp; Maybe so. But maybe it shows the duplicity involved in referring to an account of private wealth as a person.&nbsp; It seems to me that it is rather blatant case of anthropomorphism.&nbsp; …humans treating our artifacts as having our characteristics.&nbsp; We must really think we are something.</span></div>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comtag:blogger.com,1999:blog-5896319920382721541.post-17324553302108819722017-08-05T14:46:00.001-07:002017-08-05T14:46:38.452-07:00The Basis of American Aristocracy: Wealth & Property<div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">In the constitutional convention of the United States in 1787, the property-interests were well-represented. Even so, a fear of a plutocracy was voiced by those property-protectors as well. While one might conclude at first glance that the wealthy delegates were duplicitous, their position is not self-contradictory, even if the bias toward wealth is discomforting for those of us who value representative democracy.</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Governeur Morris, on July 5, asserted that property is “the main object of Society.” (1) Rutlidge, on July 5, concurred, maintaining, “Property was certainly the principal object of Society.” (2) Hamilton, on June 26, argued that the “inequality of property constituted the great &amp; fundamental distinction in Society.” (3) King, on July 6 averred that “property was the primary object of Society.” (4) In Morris’ view, property is thus “the main object of [Government].” (5) Hamilton articulated this view in the&nbsp;<i>Federalist</i>&nbsp;by writing that the adoption of the Constitution will afford additional security “to the preservation of [republican] government, to liberty and to property.” (6) “I am convinced,” he writes, “that this is the safest course for your liberty, your dignity and your happiness.” (7) So his statement that “the vigour of government is essential to the security of liberty” can be read as a plea for a General Government primarily to protect property interests. (8) Butler, on July 11, claimed likewise that government is “instituted principally for the protection of property.” (9) At the very least, these remarks evince a reductionism wherein society and government were viewed in terms of wealth. Shouldering a minority view on this point, Wilson, on July 13 in the convention, “could not agree that property was the sole or the primary object of [Government] &amp; society. The cultivation &amp; improvement of the human mind was the most noble object.” (10) This object, he suggested, is a personal right. (11) As much as this object is laudatory, it is not the object of government, which I contend is to provide and ensure order, which goes beyond the protection of property. If there is a higher purpose, government can express and operationalize societal ideals, which can thus orient whatever order government provides.</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">The primary result of the delegates’ property-centric view was the formation of a General Government of the U. States to counter the risk that State legislatures would act democractically at odds with the interests of the wealthy. Just a year before the convention, the Massachusetts legislature had attempted to act in the interest of debtors (i.e., unpaid soldiers who were still expected to pay on their farm debts; the representatives sought to stop this injustice at the expense of the creditors). Shays’ Rebellion was the unhappy result. Govereur Morris, on July 2, alluded to this affront on property interests in stating, “Every man of observation had seen in the democratic branches of the State Legislatures, precipitation—in Congress changeableness, in every department excesses [against] personal liberty [,] private property &amp; personal safety.” (12) However, what if private property is acquired unjustly at the expense of another’s liberty? In other words, liberty may run counter to the interests of the rich.</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Madison, on June 26 in the convention, remarked that “we had not among us those hereditary distinctions, … nor those extremes of wealth or poverty which characterize [the modern States in Europe]… . An increase of population will of necessity increase the proportion of those who will labour under all the hardships of life, &amp; secretly sigh for a more equal distribution of its blessings… . a leveling spirit… the future danger.” (13) Leveling would actually be in line with liberty if wealth has been acquired unjustly, as for example, under duress. Moreover, too great an inequality of wealth can threaten the viability of a republic. For example, in 1985, the top five percent in the U.S. held $8 trillion in wealth. By 2007, they had $40 trillion. Besides being in part from the dot.com and housing bubbles wherein asset values were overvalued, the concentration of wealth cannot but undermine representative democracy wherein each person has one vote. Interestingly, even as they sought to protect their wealth from being leveled via representative democracy, the delegates also feared that the U. States would end up as a plutocracy (i.e., ruled by the wealthy who would be&nbsp;<i>our</i>&nbsp;aristocracy). Governeur Morris, on July 2, expressed the following. “Let the rich mix with the poor and in a Commercial Country, they will establish an oligarchy. Take away commerce, and the democracy will triumph. Thus it has been all the world over. So it will be among us.” (14) Madison reports that Morris feared “the influence of the rich.” (15) That the U.S. was even then an extended republic on the scale of an empire was thought, at least by Morris, to strength the ability of the rich to rule.&nbsp; “The schemes of the Rich,” he maintained, “will be favored by the extent of the Country. The people in such distant parts can not communicate &amp; act in concert. They will be the dupes of those who have more knowledge &amp; intercourse.” (16) Govereur Morris, on July 2, maintained that “The Rich will take advantage of their passions &amp; make these the instruments for oppressing them. The Result of the Contest will be a violent aristocracy, or a more violent despotism.” (17)</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Madison reports that Morris’ “creed was that there never was, nor ever will be a civilized Society without an aristocracy. His endeavor was to keep it as much as possible from doing mischief.” (18) To contain such mischief (and to protect property-rights), the delegates wanted the proposed U.S. Senate to represent the interests of the wealthy (as well as wisdom and the state governments—a combination they problematically assumed would play well together in the Senate). Govereur Morris, on July 2, claimed that “The Rich will strive to establish their dominion &amp; enslave the rest. They always did. They always will. The proper security [against] them is to form them into a separate interest.” (19) Accordingly, Davy, on July 6, urged that “wealth or property ought to be represented in the [second] branch.” (20)</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">The Senate was to be a conservative institution, wherein the vested property interests must sign off on any reform.&nbsp; This could partially explain why passing health-insurance reform in 2010 was so arduous (and why extant health-insurance companies were able to kill off a competing public option). It could also explain why the wealthy could insist that their tax cuts be extended even as the U.S. Government was facing another deficit over $1 trillion also in 2010.</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">In short, the delegates to the constitutional convention were concerned that a “leveling danger” not be allowed to redistribute wealth even as they feared the advent of a plutocracy as essentially aristocratic governance. Government should protect wealth but not be run by it. In modern terms, this position might seem familiar as: CEO’s like Lloyd Blankfein of Goldman Sachs should not run the government, but the latter should not be used by those without to take from the wealthy. Yet as the CEOs’ agents in government essentially operate in the interest of the corporations and the wealthy, does not the government’s orientation to property already evince a plutocracy by a moneyed aristocracy? If so, Jefferson and Adams, who were for a natural aristocracy of talent and virtue rather than money (the latter being an “artificial aristocracy,” which the two founders believed was taking hold in the U. States even in the early 1800s), would doubtless demur. It is telling for us that government protecting wealth is virtually taken for granted among the American people even as the fear of an impending plutocracy and moneyed aristocracy is nearly absent. Any balance from the delegates’ two fears has dissolved in favor of property. The bias is so engrained in American society and government that it has become invisible.</span></div></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><br /></div><div class="MsoNormal" style="margin: 0in 0in 0pt;">1. James Madison,&nbsp;<i>Notes in the Federal Convention of 1787</i>. New York: Norton, 1987, p. 244</div><div class="MsoNormal" style="margin: 0in 0in 0pt;">2. James Madison,&nbsp;<i>Notes in the Federal Convention of 1787</i>. New York: Norton, 1987, pp. 245</div><div class="MsoNormal" style="margin: 0in 0in 0pt;">3. James Madison,&nbsp;<i>Notes in the Federal Convention of 1787</i>. New York: Norton, 1987, p. 196</div><div class="MsoNormal" style="margin: 0in 0in 0pt;">4. James Madison,&nbsp;<i>Notes in the Federal Convention of 1787</i>. New York: Norton, 1987, pp. 247</div><div class="MsoNormal" style="margin: 0in 0in 0pt;">5. James Madison,&nbsp;<i>Notes in the Federal Convention of 1787</i>. New York: Norton, 1987, p. 244</div><div class="MsoNormal" style="margin: 0in 0in 0pt;">6. Alexander Hamilton,&nbsp;<i>Federalist&nbsp;</i>#1, in Jacob E. Cooke,&nbsp;<i>The Federalist</i>, Hanover, N.H.: Wesleyan University Press, 1961, p. 7</div><div class="MsoNormal" style="margin: 0in 0in 0pt;">7. Alexander Hamilton,&nbsp;<i>Federalist&nbsp;</i>#1, in Jacob E. Cooke,&nbsp;<i>The Federalist</i>, Hanover, N.H.: Wesleyan University Press, 1961, p. 6</div><div class="MsoNormal" style="margin: 0in 0in 0pt;">8. Alexander Hamilton,&nbsp;<i>Federalist&nbsp;</i>#1, in Jacob E. Cooke,&nbsp;<i>The Federalist</i>, Hanover, N.H.: Wesleyan University Press, 1961, p. 5</div><div class="MsoNormal" style="margin: 0in 0in 0pt;">9. James Madison,&nbsp;<i>Notes in the Federal Convention of 1787</i>. New York: Norton, 1987, p. 268</div><div class="MsoNormal" style="margin: 0in 0in 0pt;">10. James Madison,&nbsp;<i>Notes in the Federal Convention of 1787</i>. New York: Norton, 1987, p. 287</div><div class="MsoNormal" style="margin: 0in 0in 0pt;">11. James Madison,&nbsp;<i>Notes in the Federal Convention of 1787</i>. New York: Norton, 1987, p. 287</div><div class="MsoNormal" style="margin: 0in 0in 0pt;">12. James Madison,&nbsp;<i>Notes in the Federal Convention of 1787</i>. New York: Norton, 1987, pp. 233</div><div class="MsoNormal" style="margin: 0in 0in 0pt;">13. James Madison,&nbsp;<i>Notes in the Federal Convention of 1787</i>. New York: Norton, 1987, p. 194</div><div class="MsoNormal" style="margin: 0in 0in 0pt;">14. James Madison,&nbsp;<i>Notes in the Federal Convention of 1787</i>. New York: Norton, 1987, pp. 233-34</div><div class="MsoNormal" style="margin: 0in 0in 0pt;">15. James Madison,&nbsp;<i>Notes in the Federal Convention of 1787</i>. New York: Norton, 1987, pp. 235</div><div class="MsoNormal" style="margin: 0in 0in 0pt;">16. James Madison,&nbsp;<i>Notes in the Federal Convention of 1787</i>. New York: Norton, 1987, pp. 235</div><div class="MsoNormal" style="margin: 0in 0in 0pt;">17. James Madison,&nbsp;<i>Notes in the Federal Convention of 1787</i>. New York: Norton, 1987, p. 235</div><div class="MsoNormal" style="margin: 0in 0in 0pt;">18. James Madison,&nbsp;<i>Notes in the Federal Convention of 1787</i>. New York: Norton, 1987, p. 251</div><div class="MsoNormal" style="margin: 0in 0in 0pt;">19. James Madison,&nbsp;<i>Notes in the Federal Convention of 1787</i>. New York: Norton, 1987, p. 233</div><div class="MsoNormal" style="margin: 0in 0in 0pt;">20. James Madison,&nbsp;<i>Notes in the Federal Convention of 1787</i>. New York: Norton, 1987, pp. 248</div>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comtag:blogger.com,1999:blog-5896319920382721541.post-25297361874732212312017-08-05T14:42:00.001-07:002017-08-05T14:42:39.743-07:00On the Aristocracy of Wealth<div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;"><span style="color: black;">The "ardent glow of freedom gradually evaporates;—the charms of popular equality . . . insensibly decline;</span>&nbsp;<span style="color: black;">—the pleasures, the advantages derived from the new kind of government grow stale through use. Such declension in all these vigorous springs of actions necessarily produces a supineness. The altar of liberty is no longer watched with such attentive assiduity; —a new train of passions succeeds to the empire of the mind; —different objects of desire take place: —and, if the nation happens to enjoy a series of prosperity, voluptuousness, excessive fondness for riches, and luxury gain admission and establish themselves—these produce venality and corruption of every kind, which open a fatal avenue to bribery. Hence it follows, that in the midst of this general contagion a few men—or one—more powerful than all others, industriously endeavor to obtain all authority; and by means of great wealth—or embezzling the public money, —perhaps totally subvert the government, and erect a system of aristocratical or monarchic tyranny in its room. What ready means for this work of evil are numerous standing armies, and the disposition of the great revenue of the United States! . . . All nations pass this parokism of vice at some period or other; —and if at that dangerous juncture your government is not secure upon a solid foundation, and well guarded against the machinations of evil men, the liberties of this country will be lost—perhaps forever!"</span></span></div><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;"><br /></span></div><div style="text-align: justify;"><span style="color: black; font-family: Times, Times New Roman, serif; font-size: large;">The rule of a few—aristocracy. The rule of the wealthy—plutocracy. Where the few, being valued above the many, are determined principally on account of wealth, the two forms of government fuse into the aristocracy of the moneyed interest. The cardinal virtue is the fundamental desire for more—otherwise known as greed. Justice is limited to peerage, or&nbsp;<i style="mso-bidi-font-style: normal;">amicitia</i>&nbsp;(friendship) based on having wealth. This sort of justice, which can be derived from Cicero, is antithetical to justice as&nbsp;<i style="mso-bidi-font-style: normal;">caritas seu benevolentia universalis&nbsp;</i>(love, that is, universal benevolence), which comes from Plato, Augustine, and Leibniz.<o:p></o:p></span></div><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;"><br /></span></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;"><span style="color: black;"><o:p>&nbsp;</o:p></span><span style="color: black;">A society wherein aristocracy is defined in terms of money can be likened to an old industrial city wherein the masses are boorish and the few are refined. The latter spend their spare time at the two or three country clubs in town. On July 4<sup>th</sup>, the masses have a motorcycle parade and fireworks downtown while the wealth-aristocrats enjoy golf and swimming followed by dinner in the dining room and then a separate fireworks show on the golf course. It is literally the tale of two cities—only one of which is gated, though some of the many can watch the clubs’ fireworks from&nbsp;<i style="mso-bidi-font-style: normal;">outside</i>.<o:p></o:p></span></span></div></div><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;"><br /></span></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;"><span style="color: black;"><o:p>&nbsp;</o:p></span><span style="color: black;">In an aristocratic plutocracy, business executives and the moneyed of the professional class (e.g., CPAs, physicians and lawyers, but not clerics and professors—the&nbsp;<i style="mso-bidi-font-style: normal;">Brahmans&nbsp;</i>who have been uneasily professionalized but not as well compensated) are valued and thus they rule. In other words, the country clubs rule the strip malls. It is not only that money is allowed to buy political power; wealth is valued so much that is presumed to have the&nbsp;<i style="mso-bidi-font-style: normal;">right&nbsp;</i>to govern.<o:p></o:p></span></span></div></div><div style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;"><br /></span></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><div style="text-align: justify;"><span style="color: black; font-family: Times, Times New Roman, serif; font-size: large;">&nbsp;</span><span style="color: black;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">Although wealth is the defining difference in a society wherein aristocracy is a function of money, refinement itself tend to go with the&nbsp;<i style="mso-bidi-font-style: normal;">upper&nbsp;</i>classes; and yet for all the lubricating manners, the country club set is limited by its value on wealth. In other words, corruption can coexist with the superficial manners typically found on the putting green. True refinement, it turns out, comes not from wealth, but, rather, from being educated. Hence, the greatest difference in a society, it turns out, exists between the pedestrian mall and the scholar rather than between the poor and the rich. Even so, in a society wherein aristocracy is defined in terms of wealth, the distance between the rich and poor is exaggerated, which in turn is seen as justifying plutocracy. Once a society can be characterized as an aristocratic plutocracy, it may be that only a mass rebellion can bring back the demos in governance; for the propertied will only consolidate their rule, and their property, unless or until they are forced to relent.</span><o:p></o:p></span></div></div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Source:</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;"><span style="color: black;">The Impartial Examiner, Essay (March 5, 1788), 5.14.15, in Herbert J. Storing, ed.,&nbsp;<i style="mso-bidi-font-style: normal;">The Anti-Federalist</i>&nbsp;(Chicago: University of Chicago Press, 1985), pp. 290-91.</span></div>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comtag:blogger.com,1999:blog-5896319920382721541.post-4820636814640380402017-08-03T15:18:00.001-07:002017-12-03T16:45:07.053-08:00Carbon-Dioxide Emissions: A Species’ Death-Wish?<div style="text-align: justify;"><div class="MsoNoSpacing"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Global emissions of carbon dioxide from fossil-fuel burning rose 5.9 percent in 2010, the largest amount on record, according to an analysis released in early December, 2011 by the Global Carbon Project. According to the analysis as reported by the New York Times, “the increase, a half-billion extra tons of carbon pumped into the air, was almost certainly the largest absolute jump in any year since the Industrial Revolution, and the largest percentage increase since 2003.”&nbsp;<o:p></o:p></span></div><div class="MsoNoSpacing"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">The researchers did not expect the extraordinary growth to persist, but did "expect emissions to return to something closer to the 3 percent yearly growth of the [2000-2009] decade, still a worrisome figure that signifies little progress in limiting greenhouse gases. The growth rate in the 1990s was closer to 1 percent yearly.” In other words, the trend has been the opposite of that which one might have expected years after Al Gore’s documentary on global warmth. Increasing knowledge of global warming did not result in a reduction in contributing to global warming; rather,&nbsp;<i style="mso-bidi-font-style: normal;">more&nbsp;</i>carbon dioxide has ensued. To be sure, the negative correlation is not&nbsp;<i style="mso-bidi-font-style: normal;">causal&nbsp;</i>in nature; knowing more about global warming has not&nbsp;<i style="mso-bidi-font-style: normal;">caused&nbsp;</i>people to decide to pollute more.&nbsp;<i style="mso-bidi-font-style: normal;">That&nbsp;</i>would really be bizarre. Even so, it&nbsp;<i style="mso-bidi-font-style: normal;">does</i>&nbsp;appear that mankind is not sufficiently interested in protecting the specie’s own long-term viability at the expense of more immediate interests. Put another way, governments have enabled their respective businesses to produce more (or cheaper) even while knowing that the earth is warming.<o:p></o:p></span></div><div class="MsoNoSpacing"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">According to the New York Times, “Scientists say the rapid growth of emissions is warming the Earth, threatening the ecology and putting human welfare at long-term risk. But their increasingly urgent pleas that society find a way to limit emissions have met sharp political resistance in many countries, including the United States, because doing so would entail higher energy costs.” Short-term costs are more important than long-term survival. This, in short, is why our species&nbsp;<i style="font-family: &quot;times new roman&quot;, serif;">does not deserve&nbsp;</i>to survive. We have produced this sad verdict ourselves.&nbsp;“Each year that emissions go up, there’s another year of negotiations, another year of indecision,” said Glen P. Peters, a researcher at the Center for International Climate and Environmental Research in Oslo and a leader of the group that produced the new analysis. “There’s no evidence that this trajectory we’ve been following the last 10 years is going to change.” This was borne out in the “deal” reached for a “New Emissions Treaty” at the U.N. climate talks ending in December 2011.<o:p></o:p></span></div><div class="MsoNoSpacing"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">According to the New York Times, “The European Union had pushed hard for what it called a ‘road map’ to a new, legally binding treaty against fierce resistance from China and India, whose delegates argued passionately against it.”&nbsp;Developing countries, including China and India, had surpassed the developed countries in their overall greenhouse emissions. In 2010, for example, the combustion of fossil fuels and the production of cement sent more than nine billion tons of carbon into the atmosphere, the new analysis found, with 57 percent of that coming from developing countries.&nbsp;Even so, emissions per person were still sharply higher in the wealthy countries, which had been emitting greenhouse gases far longer and thus they account for the bulk of the excess gases in the atmosphere. The level of carbon dioxide, the main such gas, had increased 40 percent since the Industrial Revolution. A long-term cost was being incurred simply in debating year after year without actionable results in lower emissions. For developing countries, it would seem that having an equal opportunity to pollute was worth risking the planet, at least as far as human habitation is concerned. “Am I to write a blank check and sign away the livelihoods and sustainability of 1.2 billion Indians, without even knowing what the E.U. ‘road map’ contains?” asked India’s environment minister, Jayanthi Natarajan. “Please do not hold us hostage.” This way of thinking—or decision to use hyperbole—also qualifies mankind as&nbsp;<i style="mso-bidi-font-style: normal;">not deserving&nbsp;</i>to survive.<o:p></o:p></span></div><div class="MsoNoSpacing"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Even as carbon-dioxide emissions were “alive and well,” the “deal” reached in December 2011 would continue the Kyoto agreement, to which neither the United States nor developing countries such as China and India are parties, until&nbsp;&nbsp;2017 or 2020. The terms of any agreement that replaces it would be negotiated at future sessions of the governing body, the United Nations Framework Convention on Climate Change. The basic mentality behind such a wan or pallid “deal” amid knowledge that global warming is indeed proceeding is transparent in this passage from the New York Times: “Scientists say the rapid growth of emissions is warming the Earth, threatening the ecology and putting human welfare at long-term risk. But their increasingly urgent pleas that society find a way to limit emissions have met sharp political resistance in many countries, including the United States, because doing so would entail higher energy costs.” That “increasingly urgent pleas” are being essentially ignored may itself point to a “hard-wired” weakness in the species that can be characterized as “self-defeating.”<o:p></o:p></span></div><div class="MsoNoSpacing"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Behind the increased emissions alone, moreover, is the failure of the species to self-regulate its own size. On October 31, 2011, the global population (of human beings) was estimated to have hit 7 billion. It had passed the 6 billion mark in 1999. The 10 billion mark is expected by the end of the twenty-first century. At a basic, biological level, organisms must consume resources and expel waste products: the more people, the more consumed and expelled. It is ironic that humanity places so much reliance on its technological abilities to mitigate this basic fact even as the species seems incapable of simply acting on the basis of the extant knowledge on climate change to make emissions&nbsp;<i style="font-family: &quot;times new roman&quot;, serif;">reduction&nbsp;</i>“actionable.”<o:p></o:p></span></div><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><o:p></o:p> <o:p></o:p> <o:p></o:p> <o:p></o:p> <o:p></o:p> </span><br /><div class="MsoNoSpacing"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">In&nbsp;<i style="font-family: &quot;times new roman&quot;, serif;">An Essay on the Principle of Population</i>, Malthus pointed to disease, famine and conflict (war) as nature’s trove of solutions to arrest a maximizing species from piercing a broader ecosystem, which is inherently at an equilibrium (i.e., homeostatic). Perhaps we could add a fourth solution—namely, a shift to a climatic equilibrium inconsistent with human habitation. Perhaps this is nature’s way of handling the arrogance of man, or perhaps it is&nbsp;<i style="font-family: &quot;times new roman&quot;, serif;">our&nbsp;</i>way of judging ourselves as a species. Perhaps unconsciously, the sordid species, which presumes itself to be “made in God’s image,” has a death wish—a humble sensibility underneath “just saying no” to the overweening superciliousness of the arrogance that seems almost hard-wired in the species. That is to say, the “result” of the global climate talks “attained” in December 2011 can perhaps be read as the expression of an unconscious collective will—a tacit verdict of a species on itself by procrastinating in the context of “urgent pleas.” In the context of a maximizing trajectory in terms of population, which&nbsp;<i style="font-family: &quot;times new roman&quot;, serif;">seems&nbsp;</i>to suggest dominance or victory on this planet, the species’ own verdict is certainty ironic.&nbsp;From the 2010 figures alone, my initial gut reaction was that the species had failed the “test” in a way that shows human nature to us as it is. Accordingly, I have no doubt that the verdict will be fully implemented in a few generations—our days being limited as a species. </span>&nbsp;<o:p></o:p></div></div><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 10pt;"><div style="text-align: justify;"><span style="color: black; font-family: &quot;times new roman&quot; , &quot;serif&quot;; font-size: 12pt;"><br /></span></div><span style="color: black; font-family: &quot;times new roman&quot; , &quot;serif&quot;; font-size: 12pt;">Sources:<o:p></o:p></span></div><span style="color: black; font-family: &quot;times new roman&quot; , &quot;serif&quot;; font-size: 12pt;">John M. Broder, “<a href="http://www.nytimes.com/2011/12/12/science/earth/countries-at-un-conference-agree-to-draft-new-emissions-treaty.html">U.N. Climate Talks End With Deal for New Emissions Treaty</a>,”&nbsp;<i style="mso-bidi-font-style: normal;">The New York Times</i>, December 11, 2011.&nbsp;<o:p></o:p></span><br /><br /><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 10pt;"><span style="color: black; font-family: &quot;times new roman&quot; , &quot;serif&quot;; font-size: 12pt;">Justin Gillis, “<a href="http://www.nytimes.com/2011/12/05/science/earth/record-jump-in-emissions-in-2010-study-finds.html">Carbon Emissions Show Biggest Jump Ever Recorded</a>,”&nbsp;<i style="mso-bidi-font-style: normal;">The New York Times</i>, December 4, 2011.&nbsp;<o:p></o:p></span></div><br /><div class="MsoNormal" style="line-height: normal; margin: 0in 0in 10pt;"></div><br /><div style="-webkit-text-stroke-width: 0px; color: black; font-family: &quot;Times New Roman&quot;; font-size: medium; font-style: normal; font-variant-caps: normal; font-variant-ligatures: normal; font-weight: normal; letter-spacing: normal; margin: 0px; orphans: 2; text-align: start; text-decoration-color: initial; text-decoration-style: initial; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px;"><br /></div>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comtag:blogger.com,1999:blog-5896319920382721541.post-60612528642841261952017-08-02T17:06:00.000-07:002017-08-02T17:07:02.526-07:00A Nietzschean Critique of Customer Service (Oh, Yeah!)<div style="margin-bottom: .0001pt; margin: 0in; text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">In classical literature, an apology can mean a defense, such as Plato’s&nbsp;<i>Apology</i>. In modern parlance, an apology is known as an expression of genuine sorrow and an acceptance of responsibility for having caused harm to another person. According to&nbsp;<i>Business Ethics for Dummies</i>, corporate apologies should be sincere, as soon as possible, and be coupled with a correction to the problem.<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="color: black; line-height: 107%;">[1]</span></span><!--[endif]--></span> Consumers should be on guard lest a company use the semblance of an apology for marketing purposes, and, more generally, to <i>manipulate</i>, which in itself belies the “apology.” Robert Bacal advises that an apology be used as a strategy to use “along with&nbsp;<i>other&nbsp;</i>techniques.”<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="color: black; line-height: 107%;">[2]</span></span><!--[endif]--></span> An apology as a <i>technique </i>in a <i>strategy </i>is a <i>means</i>, and thus as such it harbors ulterior motives. This invites “perfunctory or insincere apologies,” which are “worse than saying nothing at all.”<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="color: black; line-height: 107%;">[3]</span></span><!--[endif]--></span> Even a sincere apology as a means to get something suffers from ulterior motives. For example, Bacal advises that a “sincere apology can help calm a customer, particularly when you or your company has made an error. You can apologize on behalf of your company.”<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="color: black; line-height: 107%;">[4]</span></span><!--[endif]--></span> &nbsp;A <i>sincere </i>apology is mutually exclusive with an ulterior motive, especially one that is self-beneficial in some way; the orientation must be to the error. <span class="MsoEndnoteReference">&nbsp;</span>The manager who wants to&nbsp;<i>give the impression</i>&nbsp;of an apology in order to disarm the aggrieved customer therefore falls short, for such manipulation eclipses genuine sorrow. <o:p></o:p></span></div><div style="margin-bottom: .0001pt; margin: 0in; text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Likewise, a willingness to take responsibility in terms of making things right is associated with a sincere apology. In fact, a refusal to “make things right,” such as by compensating an aggrieved customer, eviscerates the sincerity itself and thus rides the apology of its content. Nevertheless, Bacal advises, “Keep in mind that tendering an apology doesn’t necessarily mean that you’re admitting responsibility.”<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="color: black; line-height: 107%;">[5]</span></span><!--[endif]--></span> Responsibility, however, goes with the recognition of having committed an error. Bacal seems to want to have his cake and eat it too! <o:p></o:p></span></div><div style="margin-bottom: .0001pt; margin: 0in; text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">As profit-seeking machines, corporations are inherently oriented to their own interests (as are most people); hence getting something out of apologizing while obviating any cost—strangely even in admitting responsibility as if the emotions involved constitute a business cost—fits with the corporate apology. In keeping with a business’ nature, it can also be argued that because companies are economic entities, a corporate apology must involve compensation having a monetary value to be valid. In other words, unless a business gives something to the wronged consumer to make up for the error or mistake, no apology has taken place. <o:p></o:p></span></div><div style="margin-bottom: .0001pt; margin: 0in; text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Bacal refers to a “bonus buy off” as “offering something of value to the customer as reimbursement for inconvenience or other problems.”<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="color: black; line-height: 107%;">[6]</span></span><!--[endif]--></span> However, Bacal adds that the monetary value need not be significant, “since the point is to be&nbsp;<i>perceived&nbsp;</i>as making an effort.”<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="color: black; line-height: 107%;">[7]</span></span><!--[endif]--></span>Here again, he equivocates, for being motivated to <i>appear </i>apologetic takes the focus off the original error. Also, the monetary value must at the very least equal the cumulative loss to the customer from the error to “make things right” again. Therefore, customers should&nbsp;<i>insist&nbsp;</i>on the corporate apology entailing adequate compensation in goods, services, or money; otherwise—especially if <i>nothing </i>is offered even when asked!—the customers should reject the&nbsp;<i>apparent&nbsp;</i>apology. <o:p></o:p></span></div><div style="margin-bottom: .0001pt; margin: 0in; text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">The vacuous statement, "We apologize for any inconvenience,"&nbsp;can be taken as an example of utter fakeness designed to manipulate under a subterfuge that is in actuality nothing more than a script. A customer turning down a company’s easy apology can use the passive-aggressive corporate lingo too, saying something like, “Unfortunately (i.e., appearance of sorrow) I am unable (i.e., false rigidity) to accept the apology as it does not come an offer of adequate compensation.” If the customer “service” employee or even manager replies that the company “cannot” compensate for its own mistakes, defects, or lapses—not the least of which are rigidity and rudeness—the customer has the answer: no apology had been made after all. The customer should reply, “Unfortunately, your company’s apology cannot accepted” and cease doing business with the company. In short, such a customer will have tested the “company’s sincerity” and found the people wanting rather than genuine. Such pretense in place of sincerity is odious, ethically speaking.</span></div><div style="margin-bottom: .0001pt; margin: 0in; text-align: justify;"><span style="font-size: large;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif;">Unfortunately, the massive herd of customer herd-animals in commercial society are too easily&nbsp;mollified by the easy corporate-speak.&nbsp; To be sure, some company managements have grasped the apology-responsibility-compensation connection. As of this writing, Starbucks still sends free-drink coupons to customers who have registered a credible complaint against a store. “We’re sorry,” a customer service employee says, “I’m going to send you some coupons for drinks on us because of your bad experience in one of our stores.” Such a response is exceedingly more credible, and </span><i style="font-family: Times, &quot;Times New Roman&quot;, serif;">genuine</i><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif;">, because there is financial cost in the mix, than a mere, “We apologize for any inconvenience.”</span></span></div><div style="margin-bottom: .0001pt; margin: 0in; text-align: justify;"><span style="font-size: large;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif;">Starbucks is rather generous in giving four free drinks for one bad experience, though more than one drink is necessary to compensate for the bad drink and or experience plus the effort to make things right. In&nbsp;</span><i style="font-family: Times, &quot;Times New Roman&quot;, serif;">Business Ethics</i><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif;">, it is noted that if the compensation is too low—such as McDonald’s offer of $800 to compensate a hospitalized customer scalded by the hot coffee—the offer can even be taken as an insult; the passive-aggression therein is real. Insult that is added to injury is really another injury. Such an “apology” extends the error and this of course adds to the compensation needed to make things right again. The point is to see through the efforts to </span><i style="font-family: Times, &quot;Times New Roman&quot;, serif;">present the appearance of </i><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif;">sincerity and speak to employees in economic terms in order to separate “the men” from “the boys” on their own turf.</span></span></div><div style="margin-bottom: .0001pt; margin: 0in; text-align: justify;"><span style="font-size: large;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif;">In Nietzschean terms, the skimpiness in the refusal to compensate an aggrieved customer points to underlying weakness, for the strong are by nature generous for their strength overflows. </span><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif;">The strong say lightheartedly, </span><i style="font-family: Times, &quot;Times New Roman&quot;, serif;">what are these parasites to me</i><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif;">. Giving up some money is not painful, for the strong are self-confidently oriented to their surfeit of strength. In contrast, the weak give up little, and at great pain, because they feel a lack (of strength) within. They are, in other words, over defensive. Some of the weak have an overwhelming instinctual urge to dominate nonetheless, as evinced in the pleasure in saying NO to even wronged customers. Even the passive aggression latent in, “We apologize for any inconvenience,” with a clear omission or refusal of compensation is of use to those “new birds of prey.” </span><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif;">&nbsp;</span><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif;">Imagine how business would change if only this underbelly—this plethora of weakness instead of strength—were made transparent in society. Weakness evades the translucent light so as to dominate even the strong even though such a condition is “upside-down” and thus in some sense against the laws of nature. The question from a Nietzschean perspective is how strength can take hold in even a weak sector in society.</span></span></div><br /><div><!--[if !supportEndnotes]--><br clear="all" /><hr align="left" size="1" width="33%" /><!--[endif]--> <br /><div id="edn1"><div class="MsoEndnoteText"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif;">1. Norman Bowie and Meg Schneider,&nbsp;<i>Business Ethics for Dummies</i>&nbsp;(Hoboken, NJ: Wiley, 2011), 239.<o:p></o:p></span></div></div><div id="edn2"><div style="margin-bottom: .0001pt; margin: 0in; text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif;">2. Robert Bacal,&nbsp;<i>Perfect Phrases for Customer Service</i>, 2<sup>nd</sup>&nbsp;Edition (New York: McGraw Hill, 2011), 19. <i>Italics </i>added.<o:p></o:p></span></div></div><div id="edn3"><div class="MsoEndnoteText"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif;">3. Robert Bacal,&nbsp;<i>Perfect Phrases for Customer Service</i>, 2<sup>nd</sup>&nbsp;Edition (New York: McGraw Hill, 2011), 19.<o:p></o:p></span></div></div><div id="edn4"><div class="MsoEndnoteText"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif;">4. Robert Bacal,&nbsp;<i>Perfect Phrases for Customer Service</i>, 2<sup>nd</sup>&nbsp;Edition (New York: McGraw Hill, 2011), 19.<o:p></o:p></span></div></div><div id="edn5"><div class="MsoEndnoteText"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif;">5. Robert Bacal,&nbsp;<i>Perfect Phrases for Customer Service</i>, 2<sup>nd</sup>&nbsp;Edition (New York: McGraw Hill, 2011), 19.<o:p></o:p></span></div></div><div id="edn6"><div class="MsoEndnoteText"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif;">6. Robert Bacal,&nbsp;<i>Perfect Phrases for Customer Service</i>, 2<sup>nd</sup>&nbsp;Edition (New York: McGraw Hill, 2011), 22.<o:p></o:p></span></div></div><div id="edn7"><div class="MsoEndnoteText"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif;">7. Robert Bacal,&nbsp;<i>Perfect Phrases for Customer Service</i>, 2<sup>nd</sup>&nbsp;Edition (New York: McGraw Hill, 2011), 22. <i>Italics </i>added.</span><o:p></o:p></div></div></div>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comtag:blogger.com,1999:blog-5896319920382721541.post-78581481570012550482017-07-31T20:04:00.000-07:002017-07-31T20:04:33.349-07:00On the Arrogance of False Entitlement: A Nietzschean Critique of Business Ethics and Management<div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;Times New Roman&quot;, serif;"><span style="font-size: large;">Nietzsche is perhaps most stunning in his eviscerating critiques of modern morality and, relatedly, Christianity. His pessimistic attitude toward modern management is less flashy, but no less radical, for the business world would look very different were it populated by Nietzschean strength rather than so much weakness that in spite of which—and&nbsp;<i>because&nbsp;</i>of which, seeks to dominate even and especially people who are stronger. Accordingly, this book provides formidably severe critiques of both business ethics and management and sketches Nietzsche’s notion of strength as an alternative basis for both. Nietzsche’s&nbsp;notion of the ascetic priest as a bird of prey with an overwhelming urge to dominate eerily similar to both the business manager and the ethicist. Therefore, the last two chapters are on Nietzsche’s unique take on Christianity, and John D. Rockefeller, a devout Baptist ostensibly compatible even with being an acidic monopolist.&nbsp;<o:p></o:p></span></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;Times New Roman&quot;, serif;"><span style="font-size: large;"><br /></span></span></div><div class="MsoNoSpacing"><span style="font-size: large;"><i><span style="font-family: Times, serif;"><a href="https://www.amazon.com/s/ref=nb_sb_noss?url=search-alias%3Daps&amp;field-keywords=skip+worden+arrogance+of+false+entitlement">On the Arrogance of False Entitlement: A Nietzschean Critique of Business Ethics and Management</a></span></i><span style="font-family: Times, serif;">&nbsp;is available in print and as an ebook at Amazon.&nbsp;</span></span></div>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comtag:blogger.com,1999:blog-5896319920382721541.post-29146086116365333422017-07-19T09:21:00.000-07:002017-07-19T09:21:01.498-07:00The Regensburg Domspatzen: Systemic Abuse of Kids in an Established Religious Institution<div class="MsoNormal" style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">The utility from beautiful music for many does not justify the physical and sexual abuse of a relative few. Even though utilitarianism goes by the motto, the greatest pleasure (and least pain) for the greatest number, the severity of the pain to a few can, I submit, outweigh a more widespread, yet relatively superficial, pleasure for others. Surely the intensity of pleasure and pain must enter into the ethical calculus. I have in mind here the Regensburg Domspatzen, a Roman Catholic boys choir, in the E.U. state of Germany. This case points to the default power of established institutions and a religious psychology.</span><o:p></o:p></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;"><br /></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: Times, Times New Roman, serif; font-size: large;">The full essay is at "<a href="http://thewordenreport-religion.blogspot.com/2017/07/the-regensburg-domspatzen-systemic.html">The Regensburg Domspatzen</a>."</span></div>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comtag:blogger.com,1999:blog-5896319920382721541.post-71627793455022200542017-06-28T17:23:00.001-07:002017-06-28T18:00:45.913-07:00E.S.G. in the Boardroom: A Recipe for Confusion<div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">What would business do without its faddish buzzwords? Is the bottom-line really so boring? Transformational leadership was once in vague, with little actual attention to raising subordinates’ moral compasses. Decades later, everything was about <i>drivers</i>—a power-aggrandized version of <i>cause. </i>Then consultants, dreaming perhaps of their kids’ little league, turned the profession into an analogy and suddenly became <i>coaches</i>. One difference is of course that most actual coaches have been players in their respective sports, whereas how many leadership coaches have been business executives or sat on a board? “Leadership assistant” is better, if in-house, otherwise "leadership adviser," assuming sufficient study or experience in leadership.&nbsp;Then amidst global warming and activist stockholders, “E.S.G.” could suddenly be heard in boardrooms with the frequency of a trope.<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="line-height: 107%;">[1]</span></span><!--[endif]--></span>Must business be led by a herd-mentality? Such leadership is internally inconsistent, for leaders are by definition ahead of the crowd, leading it rather than squawking like lemmings. In the case of E.S.G., which stands for “environmental, social, and governance,” the chatter eclipses recognition of the befuddled condition of the combo. With such different things in the mix, it is no wonder that a study attempting to quantify E.S.G. came up with mixed results. So the metric and purportedly related financial performance may not be very useful, after all.<o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">E.S.G. “refers to the three main ways to measure a company’s commitments to ecological sustainability, to its community and to corporate governance.”<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="line-height: 107%;">[2]</span></span><!--[endif]--></span>Large institutional investors, including BlackRock, the world’s largest asset manager, “have publicly declared . . . environmental, social and governance issues to be key metrics of their investment decisions.”<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="line-height: 107%;">[3]</span></span><!--[endif]--></span>Although politically correct, this mantra has some rather severe drawbacks. <o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">Firstly, what exactly is social? Good interpersonal relations inside a company?&nbsp; Stable bilateral relations with key stakeholders (which sounds hardly social in nature)? Good relations with the towns and cities in which a company has a physical presence? Work on behalf of world peace? The term <i>community </i>is inherently such a vague notion, and it be applied to very different scales, from inside a factory to the world, that the <i>social </i>part of E.S.G. is problematic, especially when misplaced efforts to quantify “community” are involved. What may seem social could actually be economic, especially in stakeholder management. Also, having or being part of “community” is different than a corporate social responsibility program geared to alleviating a problem affecting employees, stakeholders, a city, or the world. This last point also applies to ecological sustainability—does this refer to a company’s own carbon footprint, or can a company get away with making financial contributions to Green Peace? <o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">The second major problem is how different social and even ecological matters are from good corporate governance. A company’s board could improve accountability on management by severing the CEO from also chairing the board, but this does not mean that the same board has an ecological bent or wants to create a social responsibility program or give employees a sense of community (conditional, of course, given the power to fire). In short, E.S.G. combines apples with oranges. Not unexpectedly, they can relate differently with respect to financial results. Improving accountability structures and processes on management are more tightly connected to medium- and long-term financial performance than is working on a city’s problem, for instance. Improving stakeholder relations goes to the bottom line more than working for peace in the world. To be sure, the value of working on societal or global issues is real, and investors so motivated need not be thwarted by a loose relation to financial profits. The problem lies in combing E., S., and G. into a single measure and related it to financial performance. <o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><a href="https://www.bofaml.com/en-us/content/market-strategies-insights.html">A study</a> by quantitative strategists at Bank of America—that bank that showed questionable smarts in buying Merrill Lynch—found mixed results in relating E.S.G. companies and profits. On the one hand, companies high in E.S.G. tend to have less volatile stocks, yet whether those companies outperform low E.S.G. companies, the answer depends on the industry. In health-care, technology, and consumer staples, the low companies actually outperformed the high ones from 2005 to 2015. In fact, the results generally were “very similar to the performance of large versus small companies.”<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="line-height: 107%;">[4]</span></span><!--[endif]--></span>A mere look at the grab-bag of indicators demonstrates just how meaningless an overall E.S.G. number is. The study relied on a scoring system devised by Thomson Reuters, “which graded companies based on emissions and resource reductions, human rights, community engagement, work force diversity, training and development plans, board structure and compensation policy, and shareholder rights, among other things.”<span class="MsoEndnoteReference"><!--[if !supportFootnotes]--><span class="MsoEndnoteReference"><span style="line-height: 107%;">[5]</span></span><!--[endif]--></span>Imagine quantifying human rights and board structure into one number!&nbsp; It is as if the folks at Thomson Reuters were trying to come up with the general equation that so eluded Einstein relating the general theory of relativity to quantum mechanics!&nbsp; <o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;"><br /></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: &quot;times&quot; , &quot;times new roman&quot; , serif; font-size: large;">I submit that E.S.G. is an unstable molecule that would better serve business and society by being broken up into its component parts—its elements, each of which could be assessed, whether qualitatively or quantitatively. Some investors may want to invest in companies with a strong human rights record, while other investors may put a lot of emphasis on qualitative strength in corporate governance. Even within the social category, institutional investors could have very different things in mind—from workforce diversity to global warming. To be sure, investors could look for companies with diverse workplaces, no corporate social programs, and good corporate governance, or good relations with cities and good governance but no CSR programs to speak of—or all three. In short, the supposed positive correlations in E.S.G. do not hold in actuality even if it can be said that environment, social, and governance all have ideals. This is perhaps the underlying problem: the fallacy that says that just because x, y, and z have top values, the three variables are positively correlated. The other fallacy involved insists that everything in or affecting business can be readily or accurately quantified as if life itself were a spreadsheet. If investors really want companies to come out of their shells, it is vital to <i>think </i>beyond well-hooved business metrics and fads. <o:p></o:p></span></div><br /><div><div style="text-align: justify;"><br /></div><!--[if !supportEndnotes]--> <br /><hr align="left" size="1" width="33%" /><!--[endif]--> <br /><div id="edn1"><div class="MsoEndnoteText"><span style="font-family: &quot;calibri&quot; , sans-serif;"><span style="font-size: 13.3333px;">1.</span></span> Andrew Sorkin, “<a href="https://www.nytimes.com/2017/06/26/business/dealbook/can-good-corporate-citizenship-be-measured.html?ref=dealbook">Can Good Corporate Citizenship Be Measured</a>,” <i>The New York Times</i>, June 26, 2017.<o:p></o:p></div></div><div id="edn2"><div class="MsoEndnoteText"><span style="font-family: &quot;calibri&quot; , sans-serif;"><span style="font-size: 13.3333px;">2.</span></span> Ibid.<o:p></o:p></div></div><div id="edn3"><div class="MsoEndnoteText"><span style="font-family: &quot;calibri&quot; , sans-serif;"><span style="font-size: 13.3333px;">3.</span></span> Ibid.<o:p></o:p></div></div><div id="edn4"><div class="MsoEndnoteText"><span style="font-family: &quot;calibri&quot; , sans-serif;"><span style="font-size: 13.3333px;">4.</span></span> Ibid.<o:p></o:p></div></div><div id="edn5"><div class="MsoEndnoteText"><span style="font-family: &quot;calibri&quot; , sans-serif;"><span style="font-size: 13.3333px;">5.</span></span> Ibid.<o:p></o:p></div></div></div>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.comtag:blogger.com,1999:blog-5896319920382721541.post-31389279543369926302017-04-27T11:54:00.000-07:002017-04-27T11:54:01.782-07:00Stockholders Retain Wells Fargo’s Board: A Low Bar for Corporate Governance<div style="text-align: justify;"><span style="font-family: Times, &quot;Times New Roman&quot;, serif; font-size: large;">Corporate governance is supposed to hold management accountable. Slack in the mechanism enables not only a lack of managerial competence or ethics, but also an ineffectual board. Unfortunately, whether by proxies or connections—or just sheer power—a board’s chair and other directors can remain in place in spite of having failed to hold a management accountable. Put another way, it is not necessarily enough that an incompetent or unethical management (and other employees) is removed; replacing the derelict board may be more crucial and yet even more difficult.</span></div><div style="text-align: justify;"><span style="font-size: large;"><br /></span></div><div style="text-align: justify;"><span style="font-family: Times, &quot;Times New Roman&quot;, serif; font-size: large;">&nbsp;</span><span style="font-family: Times, &quot;Times New Roman&quot;, serif; font-size: large;">On April 25, 2017, the stockholders of Wells Fargo voted to retain the board that had oversight-responsibility while the management created millions of fake accounts. Even though 5,300 employees and the CEO, John Stumpf, lost their jobs due to the systemic fraud, 56% of the stockholder vote went in favor of retaining Stephen Sanger, the board’s chairman. Even though press referred to that as “a stinging rebuke for his failure as lead director,” the fact that he won re-election would hardly be felt by him as a rebuke.</span><span style="mso-special-character: footnote;"><span style="line-height: 107%; mso-ansi-language: EN-US; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: &quot;Times New Roman&quot;; mso-bidi-language: AR-SA; mso-bidi-theme-font: minor-bidi; mso-fareast-font-family: Calibri; mso-fareast-language: EN-US; mso-fareast-theme-font: minor-latin; mso-hansi-theme-font: minor-latin;"><span style="color: #0563c1; font-family: Times, &quot;Times New Roman&quot;, serif; font-size: large;">[1]</span></span></span><span style="font-family: Times, &quot;Times New Roman&quot;, serif; font-size: large;">That the perception would be otherwise signals just how low the bar had dropped on corporate governance. That the entire board survived intact is more important than that five of its directors failed to clear “the 70 percent threshold that typically denotes a serious protest vote.”</span><span style="mso-special-character: footnote;"><span style="line-height: 107%; mso-ansi-language: EN-US; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: &quot;Times New Roman&quot;; mso-bidi-language: AR-SA; mso-bidi-theme-font: minor-bidi; mso-fareast-font-family: Calibri; mso-fareast-language: EN-US; mso-fareast-theme-font: minor-latin; mso-hansi-theme-font: minor-latin;"><span style="color: #0563c1; font-family: Times, &quot;Times New Roman&quot;, serif; font-size: large;">[2]</span></span></span><span style="font-family: Times, &quot;Times New Roman&quot;, serif; font-size: large;">Clearly a “protest vote” is not worth much if the entire membership of such a negligent board is retained.</span></div><div style="text-align: justify;"><span style="font-family: Times; font-size: large;"><br /></span></div><div style="margin: 0in 0in 8pt; text-align: justify;"><span style="font-family: Times, &quot;Times New Roman&quot;, serif; font-size: large;">On account of the collusion that can occur between a management and the board tasked with overseeing that management, combined with the existing low bar in corporate governance generally, the system can ill-afford the proxy mechanism; the system is too tilted in favor of even sordid managements and board directors. Additionally, corporate social responsibility could be widened to include stockholder voting. </span><span style="font-family: Calibri;"><span style="font-family: Times, &quot;Times New Roman&quot;, serif; font-size: large;">At the Wells Fargo vote, Warren Buffett’s Berkshire Hathaway voted its 10 percent stake in favor of retaining the entire board. Even if retaining it was in Buffett’s company’s best financial interest going forward, there would be value societally and even in terms of fortifying corporate governance, which I submit would be good for business, were investors such as Warren Buffett willing to vote in favor of cleaning a sordid or ineffectual slate even if its members promise to do better. </span></span><span style="font-family: Calibri;"><span style="font-family: Times, &quot;Times New Roman&quot;, serif; font-size: large;">In other words, stockholders would strengthen corporate governance itself, as well as the particular companies even financially—and thus the stockholders themselves!—were they to vote to hold derelict boards accountable for bad oversight <i style="mso-bidi-font-style: normal;">even if said boards convince stockholders of better financials ahead</i>. Resisting such a narrow impetus can be said to be within the realm of corporate social responsibility because it is in the public interest and in line with societal norms that corporate boards actively hold their respective managements accountable even for past behavior or performance. Giving boards a pass is just as bad as a board giving its management a pass. If a narrow pursuit of financial gain comes at the expense of fortifying governance systems, then such gain is likely to be short-lived anyway because defective systems enable bad management with ineffective oversight. Fiduciary duty suffers. So, ironically, it is a matter of social responsibility that managements are held accountable, as are their respective boards themselves. Hence public policy toward reducing the power of board-management collusion is in the public interest, and corporate social responsibility should be expanded to include stockholder activism with an eye toward reforming corporate governance itself.</span>&nbsp;<span style="mso-spacerun: yes;">&nbsp;&nbsp;</span></span></div><br /><div style="mso-element: endnote-list;"><br clear="all" /> <hr align="left" size="1" width="33%" /> <div id="edn1" style="mso-element: endnote;"> <div style="margin: 0in 0in 0pt;"><span style="mso-special-character: footnote;"><span style="font-family: &quot;Calibri&quot;,sans-serif; font-size: 10pt; line-height: 107%; mso-ansi-language: EN-US; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: &quot;Times New Roman&quot;; mso-bidi-language: AR-SA; mso-bidi-theme-font: minor-bidi; mso-fareast-font-family: Calibri; mso-fareast-language: EN-US; mso-fareast-theme-font: minor-latin; mso-hansi-theme-font: minor-latin;"><span style="color: #0563c1;">[1]</span></span></span><span style="font-family: Calibri; font-size: x-small;">Antony Currie, “</span><a href="https://www.nytimes.com/2017/04/26/business/dealbook/wells-fargo-chairman-should-listen-to-investors-and-step-down.html?src=busln&amp;_r=0"><span style="color: #0563c1; font-family: Calibri; font-size: x-small;">Wells Fargo Should Listen to Investors and Step Down</span></a><span style="font-family: Calibri; font-size: x-small;">,” The New York Times, April 26, 2017.</span></div></div><div id="edn2" style="mso-element: endnote;"> <div style="margin: 0in 0in 0pt;"><span style="mso-special-character: footnote;"><span style="font-family: &quot;Calibri&quot;,sans-serif; font-size: 10pt; line-height: 107%; mso-ansi-language: EN-US; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: &quot;Times New Roman&quot;; mso-bidi-language: AR-SA; mso-bidi-theme-font: minor-bidi; mso-fareast-font-family: Calibri; mso-fareast-language: EN-US; mso-fareast-theme-font: minor-latin; mso-hansi-theme-font: minor-latin;"><span style="color: #0563c1;">[2]</span></span></span><span style="font-family: Calibri; font-size: x-small;">Ibid.</span></div></div></div>Dr. Wordenhttp://www.blogger.com/profile/02867414605883311000noreply@blogger.com